Google has an MVNO now. In case you're unfamiliar with the term, MVNO stands for "Mobile Virtual Network Operator". It basically means a service like Karma, Ting, or Straight Talk wireless which acts as a reseller of wireless infrastructure, but doesn't actually own or build infrastructure.
Google's MVNO, Profect Fi, is new and different because it lets you use both T-Mobile and Sprint infrastructure from the same phone, which switches between services (and WiFi hotspots, when available) automatically based on signal quality. Google even promises to hop phone calls from WiFi to LTE without dropping.
But the other "new" thing about Project Fi is the billing model. You pay $20 a month for unlimited voice and text, and then you choose how many gigabytes of data you want to use, and each gigabyte costs $10. For example, a 3GB plan would cost $50 a month. At the end of the month, Google refunds you for any data you didn't use, or charges you extra for any extra data you used.
Of course, paying for only the data you use is a core element of Karma's business model. We don't have a minimum monthly fee, and we don't pro-rate data, you just buy a chunk of data (like filling up your car with gas) and you can use that data until it runs out — one month from now, or six months from now, or six years from now. But the central principle is the same as Project Fi.
Because of the similarities, I asked our CEO Steven van Wel what he thought of Project Fi.
"I think it's fucking awesome," he told me.
Decouple data from the network
First off, he thinks Project Fi is a solid proof that service can (and should) be decoupled from the network. It's what we've been doing from day one, but with voice and text as well.
"Look at these different layers: infrastructure, Google or Karma that deliver the service, and then the users. But users don't have to interact with the infrastructure guys."
Users don't have to interact with the infrastructure guys.
Google is "a step of ahead of us," according to Steven, because they can switch between providers to get the best service, but it's a natural evolution for a service like ours that's carrier agnostic. While Karma's actual hardware can't switch between separate carrier networks on the fly, our service has already shifted from Clearwire WiMAX to Sprint LTE on the backend, with no need for our users to buy a "new" kind of gigabyte from us.
"On Karma, data is just a balance, and attached to nothing else," says Steven. "Not to a network, not to a device."
Pay for what you use
The second thing that excites Steven about Project Fi is its twist on the payment model. The large majority of mobile phone users in the US overpay for service.
"In our model your data never expires, with Project Fi you get your money back. It seems familiar, but it's really cool."
When you're buying mattresses or used cars, you often look to "cut out the middle man," but the reason MVNOs like Karma or Ting are successful is that they can actually save users money and provide a better, more humane service than the big infrastructure-owning providers.
What's the difference?
So, naturally, the big question is: why should you choose Karma when you can pay the same rate for data from Google?
"I have a hard time comparing the use case for Project Fi and Karma," says Steven. "Karma isn't trying to compete with your phone. Project Fi is your phone."
Specifically, right now Project Fi requires a Nexus 6, which costs $649.
Steven sees Karma as a device which brings internet to any other device. It's a "different generation" of service, for when all you need is internet. Old-fashioned concepts like "voice calls" and "text messages" will eventually become simple data services just like web browsing and video calling are right now. In fact, Steven already uses Karma like this — he keeps his phone in airplane mode, with all connectivity routed through Karma.
The big win
"'MVNO' used to be a dirty word," says Steven. "Right now you have companies like Ting, Karma, and Google entering into the MVNO space and bringing design and software into the space and to the customer."
An MVNO used to be “primarily a marketing play,” says Steven. "Now you have companies that care a lot more about their customers, a lot more about design, and a lot more about connectivity. You don't want to rely on your infrastructure provider to deliver the service. You want them to be a dumb pipe."
'MVNO' used to be a dirty word...now you have companies that care a lot more about their customers, a lot more about design, and a lot more about connectivity.
Steven likens the current carrier climate to the bad old days of buying a carrier-branded phone with carrier-branded software all over it.
"Your phone used have an AT&T logo on the back. Now it's an Apple logo. I think same thing will happen with your bill. It used to have an AT&T logo. Now it's a Google or Karma logo."
Life got better when carriers stopped controlling our whole device experience, and instead great designers and developers got the control they needed to create something actually awesome. Steven and I think the same thing is happening with mobile service now: by simply moving the billing relationship away from the infrastructure provider, innovative tech companies can make whole new experiences possible for users.