August 31, 2010


Prepaid cellphone plans gaining popularity: Once aimed at low-income customers, prepaid calling plans are luring new customers by increasing their smartphone choices. (BRIDGET CAREY, 8/31/10,

Marketers for no-contract phones are working hard to tell their side of the story. Virgin Mobile last week launched a campaign saying it's ``stupid'' to spend $100 a month on a plan when customers can go ``crazy'' and get unlimited text, e-mail, data and Web access -- including 300 monthly anytime phone minutes -- for $25. Customers can increase to 1,200 minutes for $40, or unlimited everything for $60.

Even among major service providers, prepaid options have become more popular. T-Mobile has seen its prepaid customers double since 2006, and spokesman Graham Crow said more customers are using prepaid as a way to test drive a bill.

``Parents are having their teenagers try prepaid as a way to learn about how many minutes or text messages they'll actually use and to learn a little bit about the cost of owning a phone,'' Crow said.

And though most major carriers -- including AT&T and Verizon -- that focus on contract agreements offer less-snazzy phones for their prepaid plans, they too are seeing increased demand for their no-contract options.

Prepaid subscribers made up 20.3 percent of the industry in December 2009, up from 17.8 percent at the end of 2008, according to the international wireless trade group, CTIA.

``The demographic was someone who didn't have great credit,'' said Chuck Hamby, Verizon spokesman. ``Now that doesn't matter, it's people who want to be smart with their money.''

We'd been looking for a car charger for our disposable phones, but for roughly the same price you can get a Trac-fone with car charger and Double Minutes for the life of the phone (on sale at K-Mart). So, after a $15 initial outlay you have a phone that costs $80 a year.

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Posted by Orrin Judd at August 31, 2010 6:29 AM
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