A guide to SIM-only cell phone plans

26 May 2015

For those of us who are more value conscious, sometimes a new phone (and chaining yourself to a carrier with a two year contract) is an unnecessary financial strain.

Instead, a SIM only plan - also called a bring-your-own-device plan - is a great option if you have a phone you want to keep using, or if you can afford to buy a phone outright through a retailer and want to find a plan with the best value for money.

GSM networks and SIM cards

Not all companies offer SIM card plans to customers; it depends on what kind of technology each company uses.

Cell phone companies operate under one of two types of networks; either CDMA (Code Division Multiple Access), or GSM (Global System for Mobile Communications). While some carriers still use CDMA networks in North America, globally GSM is much more common.

Fortunately, today most of the big Canadian carriers - Rogers, Bell, Telus, WIND, Mobilicity, SaskTel and Videotron - run on GSM networks. The reason this is good news? Carriers with GSM networks make it easier for their customers to swap phones, because GSM compatible phones use a SIM card.

Our Ultimate Guide to Switching and Saving

Long 3-year phone plans are a thing of the past, and if you already own a phone, you can save a bunch of money each month with a BYO Phone (or SIM-Only) phone plan. Here are our best guides to get you started; everything you need to know about how these plans work, and some of the best plans broken down by which network provides them.

TIP: Because all the major Canadian networks use the same technologies, there is a good chance that your unlocked phone will work on all of the plans listed in these guides.

What's a SIM card?

A SIM (Subscriber Identity Module) card is a small removable card that stores data needed to identify a subscriber on a wireless network. You can remove your SIM from your current phone and insert it into another compatible device, provided it’s either with the same carrier or you’ve ‘unlocked’ it from its original network (more on this later).

The big advantage of using a GSM compatible phone is that you can use it with other GSM networks (provided it’s unlocked), both domestically and also if you’re traveling internationally - which is a big plus for frequent flyers. Some CDMA phones may be 'world' phones, but generally most models aren't compatible with international frequencies.

SIM only plans

Now that we've explained how a SIM card works, it's easier to see why a SIM only plan has its benefits.

Reasons a SIM only plan might be right for you:

  • You have an unlocked phone that you want to keep (or are willing to get it unlocked).
  • Your contract is up, but you’re waiting for a new phone to be released so you can upgrade - so you need a temporary cell plan.
  • You’re looking to pay less on your monthly phone bill.

Why SIM only?

SIM only and BYOD plans usually come with all the bells and whistles you’d associate with regular cellphone plans - they just cost you less because you’re not adding on the price of a new handset (not to mention added phone insurance costs). Often, customers will find that through bypassing an unnecessary phone upgrade and just finding a new plan for the cell from their expired contract, they can secure a better deal with better value.

In comparison, enter into a two-year service plan and purchase a subsidized cellphone and you’ll find costs go up, as companies need to insure against the loss of a phone sold below cost. You may think you're saving by purchasing a phone as part of these plans, but the cost of that phone will usually be factored into the rates you pay each month for your calls and data.

Prepaid or postpaid?

Carriers that offer SIM only options usually have the same plan inclusions and exclusions as with their regular, subsidized phone deals. And overall, customers may find that postpaid contracts are generally the most value - these plans can offer more inclusions for your money than prepaid or casual/pay-as-you-go plans.

If you're looking at a SIM only plan in order to avoid signing a two year contract, however, prepaid may be a better option, and if you go with a smaller carrier, you can often find deals which will give you more minutes, text and data for your money than some of the bigger companies.

What else do I need to know?

The first step to taking advantage of a SIM plan is unlocking your cell so you can use it on another carrier’s network. Depending on who your original carrier is, you may be able to have your phone unlocked by the cell company themselves, so we recommend either giving the company’s customer service hotline a call, or visiting their website.

Don't forget!

If you do decide to go with a SIM card plan and intend to switch providers, you need to check with your intended carrier that your phone’s 3G or 4G service is supported by their system. Owning a phone that is 4G capable is pointless if you’re with a network that doesn’t support it. Likewise, you’ll also need to make sure that the phone itself will be compatible with your intended company.

For more info on switching cell phone carriers, read our guide here.

Colored SIM cards and Canadian SIM card images via Shutterstock

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