Google planning phone service where customers only pay for data they use

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Google planning phone service where customers only pay for data they use

Aim is to pressure other big carriers to provide more affordable options for people to get online

PUBLISHED : Friday, 24 April, 2015, 1:02am
UPDATED : Friday, 24 April, 2015, 1:04am

Associated Press in San Francisco

Google is trying to shake up the US wireless phone industry with a low-priced service. Photo: AP

Google is trying to shake up the US wireless phone industry with a low-priced service designed to pressure major carriers into making it more affordable for people to get online and use the search engine's services.

The service, called "Project Fi", began on Wednesday, about two months after Google revealed its plans to expand its ever-growing empire into providing wireless connections for smartphones.

Google is selling the basic phone service for US$20 a month and will only charge customers for the amount of cellular data that they use each month, instead of a flat rate. Each gigabyte of data will cost US$10 a month. That means a customer could sign up for a plan offering three gigabytes of data and get US$20 back if only one gigabyte was used in a month.

Most wireless phone carriers allow their customers to roll over unused data into another month of service without refunding any money.

The project initially will only be sold to a narrow audience that owns the Nexus 6, a smartphone that Motorola Mobility made with Google's help.

Google's pricing set-up makes Project Fi less expensive than most of the comparable plans offering by the four biggest US wireless phone carriers - Verizon, AT&T, T-Mobile and Sprint.

The monthly prices for a single line of smartphone service with up to one gigabyte of cellular data at those carriers range from US$45 to US$50 compared to US$30 from Google, before subtracting any potential credits for unused data.

The major carriers, though, offer a variety of family plans that could still be better deals than Project Fi.

Those bundled plans allow several phone lines to share a pool of cellular data. Besides trying to bring down the prices of wireless phone plans, Google is promising subscribers that their Nexus 6 model will automatically connect with the fastest network available. Google is leasing space on cellular towers built by Sprint and T-Mobile.