What Are No Contract Daily Plans?
On the prepaid wireless plans page I list Daily plans after Monthly
plans, which may not seem intuitive. In other words, you
would think that the progression would be from Pay
As You Go to Daily to Monthly to Unlimited. Yes,
that would certainly seem to make sense! However, I listed
Daily third because this type of plan was introduced
into the market AFTER the Monthly bucketed plans. So
think of the list as an evolution of
prepaid wireless products that were launched over time.
At this point you might be asking yourself why Daily plans were
launched after Monthly plans? The reality was that Monthly
plans provided a lot of value over the classic pay per minute (PAYG)
type of plan, however, paying on time each and every month for a
Monthly plan proved to be difficult for a lot of customers.
Enough so, that prepaid wireless carriers wanted to offer
customers a plan that would provide greater value than PAYG, but more
flexibility than paying a larger amount on a monthly basis.
So the spirit of Daily prepaid plans is to provide
greater flexibility. So while you don't get the same value as
a Monthly plan, you'll get better value than a pay as you go plan.
Here are some common features of
these plans to look out for:
- Is the plan subscription or
pay-per-use? This is a critical point. A
subscription plan means that you put money into your
account (ex. $10), and each day, whether you use your phone or not,
your daily charge is deducted from your account (ex. $1 per day).
it's pay-per-use, if you use your phone on that day (for anything),
you'll be charged the daily fee (ex. $1 per day). Iif you do
use your phone at all that day, you will NOT be charged anything.
these two types of plans are the same, you'll definitely want the
pay-per-use plan over the subscription plan. In fact,
generally speaking, I would recommend staying far away from the
subscription model as it rarely tends
to provide a better value than a
Monthly plan. Yes, it does allow you the flexibility to pay
on a daily basis, however, I would say that if you're struggling with a
monthly payment of $25-$30, don't let the low cost of paying for a
trick you into thinking that you're saving money over the month.
- What are the
rates? Sometimes these plans simply give you discounted
example, pay $1 per day and get 5 or 10 cents per minute instead of 15
or 20 cents per minute. However, more often Daily plans will
now give you a
bucket of minutes or even unlimited minutes.
- Pay attention to the clock! What I mean by this
is that while your daily fee usually applies to a 24 hour period of
time, sometimes it's a 24 hour day, such that if you use your phone for
the first time at 10pm, you'll only have the included services for two
hours until the end of the day at midnight. That will
virtually never provide good value, so make sure you understand what
the carrier defines as the clock. Unfortunately, this may
require that you read some of the fine print.
- What other services are included? Look for other
charges for voicemail, wireless Web, text messaging, etc.
Overall, I'm not a huge fan of Daily prepaid wireless plans.
would say that
you're either an occassional user that fits nicely into a PAYG plan, or
you're a heavier user that can find a Monthly plan that fits your
needs. This didn't used to be the case, however, with the
tremendous number of options now available for Monthly plans, it has
become more and more true. To me, Daily plans seem to be
lost in the
middle. That said, for some people a Daily plan can offer
tremendous value, so just be sure to really understand what's included
in the plan, how it works, and most importantly, how it fits into your
daily needs! Lastly, note that a lot of prepaid carriers have
been eliminating these plans because they tend not to be very
profitable. So finding one, and a good one, is becoming more
Are Daily Plans As Good As Dead?
Ok, maybe stating that Daily prepaid wireless plans are dead
is a little extreme at this point, however, they really are lack luster
in terms of value. We've seen a number of prepaid carriers outright
eliminate their Daily plan in recent years. The fact is that they tend
to not be profitable if priced too low. At that lower price point,
customers love Daily plans. Particularly if they let you only pay the
daily charge on days that you actually use the phone. Those are the
ultimate plans. Unfortunately, customers who realized that took
advantage of them (i.e. they used them!). Carriers quickly realized
that these plans didn't make sense to support, at least not at the
initial price points.
So, they increased the price, which resulted in a virtual elimination
of the great benefit that they offered. Others not only played around
with pricing, but also changed features such that lower priced plans
were no longer unlimited. This approach enabled carriers to be
profitable. But generally speaking, carriers don't feel that Daily
plans are a core part of their business. Unfortunately, managing any
type of plan as an afterthought usually doesn't yield a positive
outcome in terms of value or user experience.
Why, then, do carriers still offer Daily plans? The fact is that while
some have discontinued them altogether, there's still a respectable
number of choices out there. This plan type was introduced for a
particular need, which is to serve those who want more value than a
pay-as-you-go plan can offer, but can't afford a full monthly plan. In
other words, you may not have $40, $50, or $60 in your pocket, but most
of us have two or three dollars that we can scrounge up on any
particular day. So even if you normally buy a monthly plan, but one
month you're running short, you can always fall back to a daily plan.
This keeps phones being used, rather than increasing the probability
that we may just change to an overall cheaper carrier, or cancel
While that logic still makes sense, for at the end of the day it's,
well, logical(!), it doesn't seem to play out that way in the real
world. It's really a carrier paradox. Make the plan appealing and it
can quickly become unprofitable. Make it profitable, and it quickly
becomes unappealing to customers. Carriers that charge you the fee
everyday, regardless whether or note you use your phone, can more
easily maintain profitability. However, it's such a poor, and
non-intuitive customer experience, that these plan structures usually
aren't very successful.
That said, carriers have been having difficulty outright killing these
plans. They continue to tweak them here and there, adding and taking
away value until they feel they have found the sweet spot. Personally,
though, I don't think a sweet spot exists. I can come up with one for
customers, but not one that would truly be profitable for carriers
(surely anyone could do that!). As such, I expect that we'll see
prepaid carriers continue to veer away from this plan category. It's
simply too complex (not to mention annoying) to support!
In the meantime, I do encourage people to review available Daily plans.
Depending on your particular needs, they can actually be quite
compelling, particularly for occasional users who select a carrier that
only charges on days used.
Learn more about:
As You Go
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