by Amy

If both the contract and prepaid services had both the same phone features and rates I would have to go with the no contract. The point of the contract is to make money from what was loss from that "$300 dollar phone marked at $50 dollars." Seems like a good deal at first, but in today's economic woes for 2009, a contract can be seen as a potential lethal boa waiting to constrict its prey. Even the major cell-phone companies are feeling the squeeze as having to lay off thousands of their employees, not to mention the citizens without a job.

Another point is the phone quality. The downside to prepaid is the quality of the phone and the pricing of it. To be honest pre-paid cell-phones are priced as though they are "newer," but some of them can be as old as 4-years or more (and the quality of the phone can be junk). Is a 4-year old phone worth that $129.99 or $169.99 that a company is asking? How about $200 or $300?.

However assuming that the features are exactly the same and the rates on both contract and prepaid, I would have to go with the prepaid phone. Paying that $200 plus that extra $40 for service is a lot upfront but in the long-run can be saving. With the freedom of no binds (coughcontractscough) a person can use the same features as a regular cell-phone and STILL have the freedom to turn their service on or off basically at any time.

The last thing anyone wants is to be stuck with no money and having to pay a whopping $200 early termination fee on top of any other fees associated with a contract because of events happening in this time of uncertainty.

Comments for JuneBuggie

Click here to add your own comments

Feb 26, 2009
You make a great point!
by: PrepaidWirelessGuy

Hi Amy - Thank you for your comments; you make some great points. I especially liked your analogy with the boa ;-).

Your comment regarding phone quality is a good discussion. There are a lot of prepaid providers that sell refurbished handsets. This allows them to avoid large subsidies, which enables them to have a profitable business model should customers not stay with them long enough to break even (given that there's no contract or penalties for leaving).

However, that shouldn't mean that phones should be poor quality! Not sure if anyone else has had this experience, but when I've replaced a damaged phone thru handset insurance, they typically send a refurbished phone. I find these phones to often be better quality, believe it or not, because they've undergone a more rigorous quality check. i.e. I'd often prefer to have a refurb than a new one as they often seem to be solid and less buggy. Don't get me wrong though, I've seen some pretty cruddy refurb prepaid phones in the prepaid market that I'm surprised companies want to put their brand on.

You're also right on regarding prepaid providers often selling phones that even though they are new, are models that are years old! These are often procured from OEMs and/or carriers that have old inventory that they can't unload. This offers great value to customers, however, leaves them with a pretty unexciting handset.

I see that as prepaid evolves, and the cost of handsets and features continues to decline, that prepaid customers will be able to get the same great, latest and greatest handsets without having to make any sacrifices. And for those we want a super duper cheap handset will still have access to refurbs and old phones.

The reality is that customers should be able to want into a wireless store and pick their phone and then pick the way they want to pay (prepaid or postpaid). There shouldn't be any restriction on getting the latest phone, and only the price of the phone would change depending on whether you go prepaid or sign up for a one, two, or three year contract.

At least that's my vision of the future!

Click here to add your own comments

Return to Paying More for Phones to Avoid a Contract.

No Contracts! Period!

by Paul
(remote Minnesota)

I would pay fair market value on a phone. I would pay up to $150 for a decently featured phone (camera, web & of course, phone). Don't do much shopping online so that isn't important, nor are texting features (use couple times a week). Best battery would be a top feature that would swing me to buy, and/or phone that connects my laptop via USB. Those two features together would sway me into purchasing.

"No Contract" with the rapid changing of the guard in telecommunications advances, one could be stuck in a contract with obsolete equipment/technology (or have to ante up more bucks to upgrade). No-brainer IMHO....

Comments for No Contracts! Period!

Click here to add your own comments

Jun 29, 2010
Importance of battery
by: qbseven

To the commentors on having a good battery: right now I have an LG. Granted, mine does not have a lot of bells and whistles, but my standby lasts a good two weeks, if not more. Have never run it out on talk time which the longest for me would be about 45 minutes. Good advice to really research the battery before laying out cash for a phone!

Jun 29, 2010
Good Point on International
by: qbseven

A very valid point on overseas users - once more proving they are "higher on the curve" than we are! I spend winters in Mexico in a small city on the coast. When I get there, I just pick up a PP phone at about $30/mo. Can call back home and around Mex.....then just pitch, or give it back when I leave. Prob even cheaper is Skype

Jun 29, 2010
prepaid is best
by: theo

I dropped my contract and went with Net10 to save money and got a really decent Samsung T401G with a full slide-out qwerty keyboard and all the bells and whistles for $79.99! I am paying 10c per minute for my calls, 15c per minute for overseas calls and 3c each for texts with no roaming fees or long distance charges. I am now paying far less per month for my cell phone than when I was on contract and because of that I can afford to upgrade my phone any tome I like!

Jun 23, 2010
No Contract Phone Plans
by: PrepaidWirelessGuy

Great point about the rapidly changing industry and being stuck with an old phone! Fortunately most carriers allow you to upgrade at the discounted price once per year even when you're in a 2 or 3 year contract. However, in this fast-paced industry, even a year can seem like a lifetime! And then you're stuck with them for another 2 or 3 years. Even worse is if your carrier doesn't have the phone you want, then you're really stuck!

I also think there's a lot to be said about your battery life requirements. I remember back in the day when I could not charge my cell phone for a week or two at a time. Mind you it was much less feature-rich (and no Web), and not as many people had cell phones (i.e. less people calling me), but now I can barely make it through the day without charging my smartphone.

I know battery life isn't a sexy feature carriers and manufacturers can market, but it's becoming more and more important, and I hope they're working on research and development to improve in this area! I expect customers WILL start to make this a top priority feature when comparing phones and carriers.

Jun 23, 2010
I agree, contractless prepaid has advantages
by: Janine at prepaid.com

With Unlimited plans to suit any lifestyle and need and so may convenient ways to pay, prepaid makes sense for more and more mobile customers. The US seems to be catching up to the rest of the world where 73 percent of mobile customers are Prepaid. In Mexico it is almost 90 percent and in some countries in Europe, such as Italy and Spain, it is even higher!

Click here to add your own comments

Return to Paying More for Phones to Avoid a Contract.

Be Heard!  Let prepaid wireless providers know what you want; fill out the survey now.

Share this page:
Enjoy this page? Please pay it forward. Here's how...

Would you prefer to share this page with others by linking to it?

  1. Click on the HTML link code below.
  2. Copy and paste it, adding a note of your own, into your blog, a Web page, forums, a blog comment, your Facebook account, or anywhere that someone would find this page valuable.