Your household Wi-Fi router is also a cellphone service provider. In fact, most mobile data traffic travels through smaller networks like Wi-Fi routers, not those hulking cell towers outside.
The internet companies Google and Bandwidth.com have turned that little-known fact into mobile phone services that rely on cell networks they lease from traditional carriers, but if a Wi-Fi network has a better connection, they shift phone calls and data over to Wi-Fi instead.
More often, your Wi-Fi is going to have a stronger data connection, so in tech industry parlance, these phone services are sometimes called "Wi-Fi first."
Less work on cell towers leads to lower costs for consumers. Bandwidth's phone service, called Republic Wireless, offers a range of plans, including one for $25 a month for unlimited minutes and messages and 1 gigabyte of cellular data. Google's service, Project Fi, costs at least $30 a month for the same package, and you are reimbursed for the cellular data you don't use.
In contrast, AT&T's cheapest phone plan starts at $45 a month for a bucket including only 300 megabytes of data, and Verizon charges $50 a month for its plan including one gigabyte of cellular data.
After testing Project Fi and Republic Wireless for a few weeks and comparing their performance with traditional carriers, I concluded that they are ideal for budget-conscious consumers who don't need to have the latest and greatest devices.
Project Fi and Republic Wireless both work only with phones running Google's Android system. In the United States, both primarily rely on Sprint and T-Mobile networks for cellular coverage. Project Fi's plans also include cell coverage on foreign networks in more than 120 countries.
When you receive a Project Fi phone, you insert the SIM card and activate it through the Project Fi app. Similarly, with Republic Wireless, when you receive the phone, you activate it through the Republic app downloaded through Google's app store.
The technologies for both services work seamlessly — if you start a phone call over a Wi-Fi connection and move out of its range, for example, the call is handed off to a nearby cell tower.
Because Republic Wireless and Project Fi are similar, the trade-offs will guide you. Project Fi costs a little more than Republic Wireless, but you will also have the benefit of being able to use the service overseas at the same rates, without swapping out a SIM card.
But a major downside is that you have only two phone options: Huawei's 5.7-inch Nexus 6P and LG's 5.2-inch Nexus 5X.