Two-Thirds Of New US Wireless Subscribers Go PrePaid

As a result of increasing wireless bills, a new survey found that two out of every three people who sign up for new wireless service in the U.S. opt to go prepaid instead of being locked into a lengthy and costly contract. The survey was...

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Two-Thirds Of New US Wireless Subscribers Go PrePaidAs a result of increasing wireless bills, a new survey found that two out of every three people who sign up for new wireless service in the U.S. opt to go prepaid instead of being locked into a lengthy and costly contract.

The survey was conducted by the New Millennium Research Council, a Washington D.C.-based think tank, who found that roughly 65 percent of the 4.2 million net subscribers added by U.S. phone carriers in Q4 2009 were prepaid.  In addition, prepaid providers grew 17% in Q4 2009 to 54.4 million subscribers, up from 46.3 million the previous year.

There were 285 million total wireless subscribers in the U.S. at the end of 2009, with one out of five now using prepaid phones, bringing prepaid users to 20% of the total wireless market, up from 18% at the end of 2009.

While the recession has no doubt played its part in the surge in prepaid subscribers, another key aspect is the type of plans offered by prepaid carriers- namely the “all-you-can-eat” unlimited tiers for $30-$45 per month.  Through the eyes of consumers, going prepaid makes much more sense, especially for the average mobile user.

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6 comments

  1. SimonC

    I so totally agree with you, Kimberly. I also use NET10 and love their witty ‘no evil’ ads. But they really do offer excellent value for money and exceptional service. Loyalty should be earned by the carriers, not enforced through unfair contracts!

  2. Anderson

    You know, the prepaid ocncept is so old news for the rest of the wrold except for us here in the US. Too bad it took a recession to make us realize that this totally sensible option existed. I’ve had prepaid service for at least four years now, well before our financial dooms day just cause it made sense. The contract carriers were and are still having a field day with those who insist on giving their money away. Case in pint, I currently have TracFone, which offers one of the best prepaid plans. For just under $30 a month I get 150 minutes a month, and with my phone, it even doubles all the time, now, how can I go wrong with this? Granted, I’m not on the phone 24/7, but really don’t need to be. What I really need to do now is to save money, and with TracFone prepaid, that’s exactly what i’m doing.

  3. Anita

    I agree – the recession force a lot of people to reevaluate their expenses. That was definitely the case with me. After years of paying for an unlimited plan at $45/month, I made the switch to Net10 and now only pay $15 a month. It finally dawns on me that I rarely use more than 150 min/month. I wish I would have come to this realization sooner!

  4. Kimberly

    The recession is a major factor in this shift for sure, but keeping customers for an extended period of time really depends on the quality of the company. I have friends and family who switched over to Net10 prepaid and while I am still on a contract with a carrier, their savings and no contract makes it an attractive notion. Each of them is saving between $40 and $60 a month with Net10 and even have the pay-as-you go minute options. Their TMobile calling network offers the same calling coverage my contract plan does with the issues. Even their advertisting campaign, the whole “fighting evil” cartoon advertisment, is catchy enough to grab your attention. Prepaid companies like Net10 really seem to be offering bang for the buck.

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  6. Justin Bieber

    I think it is market saturation for those plans in $30-45 range. Not every one has use for a smartphone with Internet access.

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