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MVNOs: What They Are and How They Can Save You Money

Cell Phones, Utilities
What is a MVNO?

You’ve probably heard of the “Big Four” cell phone carriers: Verizon, AT&T, Sprint and T-Mobile. But increasingly, they’re not the only players in town.

There are dozens of smaller, often prepaid, carriers — called mobile virtual network operators — that offer alternatives. And that’s good news for consumers, because MVNOs can provide cheaper, more flexible mobile plans than the Big Four.

An MVNO primer

MVNOs are small carriers that lease cellular coverage and data bandwidth from — or share it with — a member of the Big Four, then resell it to customers. Hence the “virtual network” part of the name: MVNOs don’t own any actual hardware. The Big Four own and operate it.

Sometimes these MVNOs are wholly owned by the bigger carriers; for example, AT&T owns Cricket Wireless and allows it to operate on the AT&T network. Other MVNOs are independent entities, like Republic Wireless or Consumer Cellular, that lease space on someone else’s network.

You’ll see Sprint’s name pop up in a lot of these agreements, as it has been relatively friendly to MVNOs compared to other big carriers. It has a history of selling data at wholesale rates — as Gigaom reported in 2012, when MVNOs were newly resurgent — and, thanks to its weak market position relative to AT&T and Verizon, it has an interest in cultivating any competitive advantage it can.

» COMPARE: Best prepaid cell phone plans

Some caveats

Since they’re taking up some of the bigger networks’ finite bandwidth, MVNO users sometimes receive lesser priority than name-brand customers. For example, Cricket Wireless LTE data speeds are capped at 8Mbps, whereas AT&T customers can enjoy LTE data speeds of more than 20Mbps, depending on the location.

This isn’t always the case, but double-check before you sign up so you know exactly the service you’ll receive. And make sure the phone selection is to your liking, as some MVNOs offer limited choices.

Is an MVNO right for you?

MVNOs may have some restrictions, but they also come with greater flexibility and often cheaper costs. Some, such as Republic Wireless and Google’s Project Fi, are pioneering an attractively simple pricing option in which customers essentially pay for data as they go at one flat rate. Plus, most MVNOs operate with no-contract prepaid billing, meaning no credit checks.

If saving money is a higher priority for you than having the highest data speeds, or if you prefer not to sign a long-term contract, MVNOs are worth checking out.

» MORE: 3 steps to finding a cheap cell phone plan

List of major MVNOs

Here’s a list of some of the larger MVNOs, their owners when applicable, their network coverage partners, and some information to help you pick the best one for you. U.S. Cellular is an odd one here as it operates its own network — the fifth-largest — but partners with a semi-obscure broadband company called King Street Wireless for its LTE coverage.

CarrierOwned ByNetwork Coverage ProviderNerd Tips
N/AKing Street WirelessU.S. Cellular is the fifth-largest carrier behind the Big Four. It offers postpaid and prepaid plans.
AT&TAT&TCricket is among the best prepaid options overall and also offers a great prepaid family plan.
SprintSprintVirgin Mobile provides great prepaid options, with some of the cheapest plans on the market and unlimited music-streaming features.
SprintSprintBoost is a great option for parents looking for a prepaid family plan.
T-MobileT-MobileMetroPCS offers some nice features at a decent price, but other carriers, like Virgin and Boost, do the same for less money.
America MóvilVerizon, AT&T, T-Mobile and Sprint
TracFone charges reasonable prices, but lacks many of the features other prepaid carriers provide.
TracFoneVerizon, AT&T, T-Mobile and Sprint
Straight Talk is a subsidiary of Tracfone, and also has low prices — but you'll get what you pay for when it comes to features.
TracFoneVerizon, AT&T, T-Mobile and Sprint
Net10 is also a subsidiary of Tracfone.
GoogleSprint, T-Mobile and U.S. CellularProject Fi charges customers only for the data they actually use, at a flat rate. It offers limited phone selection.
N/AVerizonGreatCall's phone plans are specifically geared toward seniors.
N/AAT&TConsumer Cellular received the highest overall customer satisfaction rating among postpaid carriers in a 2015 Consumer Reports survey.
N/ASprintRepublic Wireless has a pay-as-you-go flat data rate scheme similar to Project Fi's and a soon-to-be-expanded phone selection.

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Stephen Layton is a staff writer at NerdWallet, a personal finance website. Email: slayton@nerdwallet.com.