Buying a local mobile cell phone SIM card

Getting a local SIM card makes sense if you expect to make and receive frequent calls and text messages during your travel.  The most common network in China is the GSM system, which runs on frequencies of both 900 and 1800.  Unfortunately, the US GSM system runs on 1900 (yes, they did this on purpose to sell more phones), so your safest bet is to bring a tri-band phone.  Worst case is you can buy a cheap 900/1800 phone in China for $300RMB (I've seen a pretty decent mini-Motorola at that price).  I also have one available for rent for my guests ;-)  China Unicom, the other mobile company, runs on CDMA, but I'm not too familiar with it. 

The most popular prepaid GSM SIM card that you can buy from street vendors is China Mobile's 神州行畅听卡16元版（Shen2Zhou1Xing2), $16RMB/month, unlimited call receiving edition.  The packet and card look like this:

 

Getting the SIM card 

You can usually find shops that sell them near the subway stations.  You can also find shops that sell cell phones inside shopping centers.  The prepaid card comes with $50RMB credit, but sells for anywhere from $55-100RMB per card.  The vendors will try to sell at the higher prices, claiming the phone numbers are better -- no 4's (same sound as death in Chinese) and more 8's or 9's (same sound as prosperity in Chinese).  You'll also see a card with a scratch-off PIN, which you can use as the password to log on to the China Mobile's Shanghai site to check your phone number account (only in Chinese).

Rates 

With this type of card, local calls are $0.13RMB/min, and receiving calls from anywhere is free.  China domestic text messages are $0.10RMB/msg, and international texts are $1RMB/msg whether you're roaming or not, so most people end up texting a lot.  Receiving text messages is also free.

Making internationl calls 

I'm sure you can probably get a cheaper rate by using a calling card, but make sure you figure out how much those cards really cost (can be bought at a steep discount) and what the calling rates are.  Recently, China Mobile is promoting its "12593" access number for international calls.  For an additional $1RMB/month, you can dial 12593 in front of international numbers and get $0.4RMB/min calling US, Canada, HK, and Singapore, $0.7RMB/min to Taiwan and Macau, $1RMB/min to Japan and Korea, and $1.5RMB/min to most of European countries.  This is by far the cheapest rate you can get on the mobile phone without using a calling card, and in some cases it's even cheaper than dialing from a land line.  To activate this service, you can send a text message of "KTXGX" to 10086.  You'll receive a Chinese message back to confirm.  Just don't forget to put 12593 in front the numbers when you dial!  Dial like this: 12593+00+COUNTRY CODE+phone number.

Roaming outside of China - Not recommended.  It's pretty expensive to use a China number while roaming outside of China, and you'd need to put down a hefty deposit to even turn on the international roaming option. 

Making domestic long distance calls from Shanghai Basically, calling anywhere in China outside the city you're in is considered long distance.  The best rate I can find is to subscribe to the "17951" plan, where you pay another $1RMB/month to receive a $0.20RMB/min long distance rate.  Send a text message of "IPYH" to 10086 and begin adding 17951 to all your Beijing or other inter-city calls when in Shanghai.  Calling while roaming outside of ShanghaiIf you plan to travel to multiple cities within China, you can pay another $1RMB/month to activate the trusty 12593 code to get discount rates when roaming domestically.  This is the same code as the international long distance but you have to pay again... but you need to send a different text, "KTMYB", to 10086 to activate this one (are you confused yet??).  Under this plan, you pay $0.49/min when roaming and calling and $0.30RMB/min when you receive calls.  If you don't do this, receiving calls under the original plan would cost you $0.6RMB/min PLUS $0.07RMB/6 seconds.  These can rack up pretty quickly and drain your prepaid credits.

Refill and checking credit balance 

For refill cards, you can also buy them at those same shops I mentioned above, or at tables set up on the curbside selling these and calling cards -- just make sure you complete the refill process successfully before leaving the vendor.  To refill, call 13800138000 and enter "2" for English.  To check the amount remaining on your phone, send a text message "YECX" to 10086 and it'll come back with a Chinese text message containing a number in it -- that would be the amount you're looking for.

So is it any wonder that China Mobile is raking it in?  With complicated rate plans like these, callers can easily make mistakes and spend a fortune.  To summarize, you basically should spend an extra $3RMB/month to cover your basis.  A word on how long these SIM cards are good for -- basically if you don't return to China for more than 3 months, you're better off getting a new card next time you're back, because they'll continue to charge the monthly fees even when you're not using it until all the money in there runs out.

If you're staying longer

One good news is that you can convert to other calling plans without changing your phone number, should you decide to stay in Shanghai long-term.  The plan I currently use is the China Mobile's GoTone $50RMB/month plan, where you get 450 free local minutes included (but you'd still need to pay addtional subscriptions here and there to get those discounts).  I wonder if I can make money by becoming a calling plan optimization consultant?