NEW YORK (MainStreet) — You probably have seen the budget cellphone carrier ad in a movie theater. "Do you want to pay $12 or $6 for a movie ticket? You have a choice." From there it's a quick segue into "you have a choice" when it comes to cellphones, and the point is hammered home: prepaid phones deliver pretty much exactly the same service for half the price. And without a multi-year contract.
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Do the math. Consumers with the big two cellular carriers, with newer smartphones and a data plan, are customarily paying well over $100 per month. Many pay close to $150. Cut that in half and, suddenly, that is $900 a year in your pocket that's available for fun stuff like a weekend getaway or lots of movie tickets. But exactly how you get half-price tix, the commercial glosses over).
The hangup question: is prepaid really as good as postpaid? Without giving up a thing?
The answer: yes. Sort of. Well, at least sometimes.
Plain fact is that it is not always easy to generalize but, say many experts, many consumers can get most, or all, of what they care about with cellular by switching to prepaid carriers such as Cricket, Boost, or Straight Talk.
Understand this: the traffic on prepaid phones almost always goes over the towers and networks operated by the Big 4 carriers: Verizon, AT&T, Sprint and T-Mobile.
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Calls on Boost or Virgin Mobile - two brands owned by Sprint - are not almost as good as calls on Sprint; they are exactly as good, said Jayne Wallace, director of corporate communications for the Sprint Prepaid Group, and she could be that unequivocal, because that traffic travels over the Sprint network.
She added a caveat, however: "With our prepaid there is no roaming. On Sprint there is." That can be critical, or it might be irrelevant. Live in an area where the Sprint signal is strong, and that prepaid phone is a rockstar. Go where the signal is iffy - where Sprint might pass off calls to, say, Verizon in mutual assistance pacts that characterize the cellular industry - and, alas, that prepaid phone is a lifeless brick.
Here's the plus: for $55 per month, with no credit check, Boost delivers "unlimited everything - calls, data, texting," said Wallace. With Sprint, that same "unlimited" everything plan runs $80 per month, which is $300 per year more. Is occasional roaming worth the premium?
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That's a caller-by-caller question to answer.
Not so fast, though. Nicholas Hamner in Levittown, Penn. said he dropped Virgin Mobile, and switched to Sprint, because "the phone selection was limited to low-end devices...the features were limited and performance was middling." Hamner said Virgin Mobile did ultimately get the iPhone 4S, but only after it had been out for nearly a year.
True enough, admitted Wallace, who said: "There is a lag between when the top four carriers get the newest phones and when they come to prepaid."
But she stressed that, for most consumers, that is no deal killer and for those to whom it matters, they simply won't consider prepaid.
Another caveat: "You will pay more for the phone. Because you don't have a long term contract, you'll be paying up front," said prepaid devotee Amber Bigler Newman. She's right. A Samsung Galaxy S 4, via prepaid carrier Metro PCS, is tabbed at $549.00. That same phone goes for around $150 with a two year contract at Verizon - meaning that at least part of the bump in post-paid pricing is to recoup the initial subsidy on the cost of the phone.
Incidentally, although many believe numbers on postpaid carriers cannot be ported over to prepaid, that's not always true, said Sprint's Wallace, who added that both Virgin Mobile and Boost have recently run special offers sweetening the deal for new customers who port existing numbers into their service. "We do it many times every day," she said.
A last fact: most of the planet has always been on prepaid, pay-as-you-go phones that usually involve no commitments. "Most of the world's mobile market is offered on a prepaid basis," wrote Roslyn Layton, a Ph.D. fellow in the Center for Communication, Media and Information Technologies at Aalborg University in Denmark.
That's just fact. The U.S. postpaid market, with big cellphone subsidies, is the outlier in global telephony. So maybe it is indeed time to use that "choice" and go with what's good enough for the rest of the planet.
--Written by Robert McGarvey for MainStreet