Why the Verizon MiFi Could Kill the Cell Phone

Finally, there's a product that puts a wireless hotspot in your pocket: the MiFi, a battery-powered device the size of a thick business card that provides its own password-protected wireless network (NYT's David Pogue reviews here). This is cool for all the obvious reasons -- with MiFi in your pocket, your computer, phone and iPod Touch are connected to the Internet whether you're on a road trip or the beach. But it's especially cool for a reason Pogue doesn't mention: It could signal the end of cell phones.


That's a big statement, so let's back up a second. Three weeks ago, I cited an argument that VoIP ("voice over internet protocol") could replace cell phones because dialing over the internet is much cheaper than dialing through a national cell phone network. The problem was, if you need the Internet to make calls, you're going rely on Cosi shops and other hotspots for service. Three weeks ago, you couldn't live in a permanent wifi cloud. Two weeks from now, you can.

That means that you won't need a cell phone -- or at least a cell phone plan. As long as you have a device with a speaker and audio that can connect to the Internet, like an iPod Touch, you can use Skype to make all your calls because the service provider (the Internet) is always in your pocket. Verizon plans to charge $40 a month for basic service. Not a bad deal for all-you-can-eat browswing and calling over the Internet.

Now, inevitably, some caveats. First of all, I imagine not a lot of people are jumping to spend $40 a month for an unproven product. Second, the battery life on the MiFi is four hours of use (although it shuts off after 30 seconds of inactivity to conserve energy), and even the infamous iPhone battery beats that by a mile. If you're a BlackBerry nut, you're going to be reluctant to trade your steamlined email checking device for a iPod Touch, which would require you to one program, Skype, for calls and another, Gmail or your other mailbox, for email retrieval. I'm sure there are plenty of other trade-offs that come from trading your phone in for an iPod that I haven't though of yet, but others who have tried say the switch isn't nearly as painful as we think.

So at the end of the day, the question, and the irony, is: Is Verizon now rolling out the thing that could kill the cell phone?

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Derek Thompson is a senior editor at The Atlantic, where he writes about economics, labor markets, and the entertainment business.

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