Raleigh-based Republic Wireless is offering a way to entice users to its flat-rate service with a lower upfront cost for a phone in exchange for a higher monthly price.

The Raleigh-based company, which is part of privately held Bandwidth, is launching a plan that includes a $99 fee for the Motorola DEFY XT smartphone – the only one that works with the service – rather than $249.

The monthly fee is $29 per month.

The original rate remains $19 per month for unlimited voice and data.

“Both plans have the same unlimited service, no contracts, with a 30-day money back guarantee,” says Noreen Allen, chief marketing officer at Bandwidth.

Republic has generated a great deal of media attention since formally launching the service last month. It touts the fact users can save hundreds of dollars a year by using its combination of cellular and Wi-Fi service.

“$19 a month is a disruptive price. And if this represents the future, it’s going to be hard to ignore Republic Wireless,” notes USA Today in a review.

Walt Mossberg of The Wall Street Journal wrote an extensive review in Wednesday’s editions that both praised and questioned the Bandwidth service as well as the phone.

“Well, Republic is using an unusual technology approach that’s smart and may even represent the future,” Mossberg wrote. “But today, it doesn’t deliver the best voice quality and it requires a specially equipped phone. The sole phone that works with the system now is mediocre.”

Republic aimed to have 50,000 customers by its formal Jan. 1 launch after signing on users through beta trials last fall. However, the company has so far declined to disclose how many users it has.