Wal-Mart Launches Cell Phone Plan

Wal-Mart (Stock Quote: WMT) announced Monday that it will launch its first store-branded cell phone plan.

The Wal-Mart Family Mobile service, powered by T-Mobile’s USA Network (Stock Quote:DT), will feature unlimited calling and texting and cost $45 a month for the first line. Each additional line will cost $25 monthly?. The service will be available for purchase Sept. 20 in nearly 2,500 nationwide Wal-Mart locations.  

The new offer marks Wal-Mart’s first foray into “post-paid” cell phone plans that require subscribers to pay a single bill at the end of the month. However, unlike many of these plans, the service doesn’t require customers to sign annual contracts or, consequently, pay early termination fees.

Wal-Mart has offered prepaid service plans, where customers pay for minutes in advance of use, through the Verizon (Stock Quote: VZ) network since last year. The service Smart Talk also costs $45 per month for unlimited calls and texting, but doesn't offer a discount for additional lines. There are also no smartphones available on the service.

“This plan provides families with the flexibility to connect with each other without surprise charges and with the added benefit of one of the most trusted wireless network providers,” Greg Hall, the chain’s vice president of merchandising, said in a press release.

According to the press release, the elimination of the annual contract can save “a family of three savings of up to $1,200 per year compared to the leading national unlimited talk and text plans.” The comparison is based off of comparable post-paid unlimited talk and text family plans with three lines of service offered by AT&T (T) and Verizon. It does not, however, include taxes, fees or the cost of the phone.

Wal-Mart plans to offer five different phones that will use the service from Samsung, Motorola (Stock Quote: MOT) and Nokia (Stock Quote: NOK). The cheapest phone available will be a basic Nokia phone for $35. The most expensive phone will be Motorola’s Cliq XT, a smartphone that will retail at Wal-Mart for $249, which is actually $80 less than T-Mobile's own contract-free price.

Smartphone users, however, need to be cautious. Wal-Mart’s data plan, structured as a prepaid pool of gigabytes that can be accessed continuously by the subscribing family, can be costly. According to PCWorld, each new line comes with 100 MB of data. An additional 200 MB costs $10, 500 MB costs $25 and an additional gigabyte costs $40. The data rolls over to the next month, but the 100 MB you received at the time of purchase doesn’t replenish itself. You need to purchase more as needed.  

AT&T's contract customers, conversely, pay $25 per month for two gigabytes of usage, but the unused data is lost when the month ends.  Verizon charges contract smartphone users $30 a month for unlimited monthly data.

Wal-Mart has more than 8,400 locations under 55 different banners in 15 countries. Check here to find out if a Wal-Mart near you is offering the service.

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