"Ridiculous insurance/replacement prices"1.0 starson by XenophonJones
Pros: Maybe the service makes sense for some countries, short trips, or trips with insane data usage.
Cons: For even moderate stays in the UK, it makes no sense whatsoever - you've got much more reasonable options. The replacement charges for lost or damaged units shows you this service is a total crock.
Summary: I'm going to the UK this summer for 10 days, and wanted to stick with AT&T for voice service on my iPhone. I didn't want to have to contact every possible person who might want to contact me from the States to tell them a UK telephone number that was only good for 10 days, and AT&T's global voice rates aren't that bad, all in all. But I obviously knew there were cheaper ways to get mobile internet service, and the idea of getting a MiFi/Mobile Hotspot with local service in the UK struck me as good because one of my travel colleagues would have a laptop - so we could share.
I found XCom Global's website and originally was quite excited, but as I did a little more research, I saw the numbers just didn't add up.
If I went with XCom Global for service, taking advantage of their current promotion, the total cost for my trip, without insuring their unit, would come to $164.45. If the unit is lost or damaged, it costs $800 to replace. If I insure the unit, the total cost of service for the trip is $207.90, and if the unit is lost or damaged, the deductible is $160. If I make the order within 10 days of my departure, you can throw on another $29.90 for shipping.
Those replacement rates told me everything I needed to know. $160 for replacement of the unit WITH INSURANCE? You can get better rates and deductibles on a UHaul rental truck.
I looked at eBay and, sure enough, you can BUY the exact same Novatel unit, unlocked and refurbished, from a reputable seller for around $125, with free shipping, and comparable units run $100-$150. So, you can OWN one for LESS than the replacement costs you pay to XCom even when you've insured the unit with them. At Amazon, you can buy the same Novatel unit BRAND NEW for $250 ($550 less than XCom's uninsured replacement price). And that Amazon price is discounted from the LIST price of $380 ($420 less than XCom's uninsured replacement price). So, what, is XCom's purchasing department too stupid to know that Amazon exists?
No, they're just using scare tactics to compel you to pay higher prices. So, for the $800 you pay if you lose or damage their Novatel unit without insurance, they'll go ahead and buy 3 more and still enjoy a profit.
OK, so that gets you a unit, but what about service? European providers are pretty darn flexible with Pay As You Go (PAYG) plans for not only voice and SMS/text service, but also data. One of the major networks in the UK, 3 (three.co.uk) is one of the most flexible. If I bought one of the unlocked units that can be found on eBay, I could go to a shop that sells 3 SIM cards and have a variety of PAYG options. For a trip my length, 1 GB good for 1 month at £10.49 (about $17 as of 6/18/11) could be good. But let's be safe and get 3 GB good for 3 months. I may be there only 10 days, but let's assume that between the laptop and my iPhone and not having WiFi provided in our accommodations, we'll really tear through some data. Cost for the 3 GB bucket? £20.99 (about $34 as of 6/18/11).
So, if i buy the same Novatel unit from eBay, meaning I own it forever, and buy a 3 GB bucket of data in the UK from 3, my total cost ? $159. Huh. That's almost $5 less that XCom's offer without insurance, and about $49 less than XCom's offer WITH insurance. But most tellingly of all, it's $1 than the deductible you pay to XCom if you lose and damage their unit. In other words, you can BUY a unit to keep forever AND get a good deal of mobile broadband usage for less than the DEDUCTIBLE you pay to XCom when you lose their unit. Does that sound like a good deal to you?
But when you dig even deeper into 3's offerings, you can find even better arrangements. They offer a Huawei MiFi/Mobile Hotspot unit AND the PAYG 3 GB/3 month plan for £71.99, with no further obligation. That's about $117 as of 6/18/11. Yep. That's over $47 less than XCom's service without insurance, and about $90 less than XCom's service with insurance. And it's around $43 less than the deductible you pay to XCom if you lose their Novatel unit INSURED.
So, you can get a MiFi locked to the 3 network to keep forever and 3 GB of data with no further obligation for far less than XCom's offering - or even less than what you'd pay for replacing a lost/damaged unit WITH insurance. You wanna bet that 3's Huawei is significantly lower quality than the Novatel that XCom uses? I seriously doubt it. And if it had a problem in the 10 days I'm there, I'll just go back to the shop and have it replaced. I don't know when I'll travel to the UK again, so I don't know if I'll ever need to use the unit on 3 again, but I bet there's a way I can get it unlocked eventually. Or I'll just always have it available if I go back to the UK, which is the one place to which I've travelled the most and am likely to travel again.
But assuming basically equal quality of service and hardware, 3's offering is the lowest price for this particular trip.
My example is strictly for the UK. But that you can find a similar unlocked MiFi unit to own that you could take anywhere for a reasonable price is incontestable, and if you have the language skills to look at offerings in other countries, I don't doubt that you can find similar deals to 3's throughout Europe.
Given the costs of overhead and operations, I could have sympathized with XCom's pricing structure. If you travel a lot and go to multiple countries, XCom might make sense. But their insurance/replacement scheme lays bare what a rip-off they really are.