Prepaid Cell Phones
Here you will learn all about Prepaid Cell Phones in 9 points.
Prepaid cell phone planes used to be sketchy alternatives for those with less than stellar credit ratings, but not anymore. They can be ideal for anyone who's had enough of restrictive two-year contracts, scary overage fees, or micromanagement of cell phone minutes. Likewise, while they used to be more expensive than traditional plans, prepaid costs have begun to fall, and the plans have become just another way to break into the cell phone game. As the popularity of prepaid has skyrocketed, even the big brand-name carriers have jumped onto the bandwagon.
Prepaid plans are pretty self-explanatory: you open an account and pay for airtime up front. When you run out of minutes, you either pony up for more or, if you've had enough, simply let your plan expire. Want to switch carriers or cancel your service? No problem--you're not under contract, so you're free to jump ship anytime.
The big advantage of prepaid is that there's little hassle and no commitment. By contrast, if you sign up for a traditional plan with a major cellular carrier, you'll likely sign a contract binding you for a year or more. If you break the contract, you'll have to pay a big penalty. Another plus of prepaid plans is that you won't have to endure a credit check; in some cases, you won't even need a credit card. With Virgin Mobile, for instance, you can walk into a Virgin Mega store, grab a phone with prepaid minutes off the rack, plunk down your cash, and start dialing.
To get started with a prepaid plan, you buy a phone and a set amount of service. For some carriers, you pay specifically for a bucket of minutes, ranging from 30 to 1,000; for other carriers, you buy the equivalent of a calling card (say, $25). When you use up your minutes or your calling card, your phone stops working, and you must buy more--thus, avoiding overage charges. You can shop through the carrier's Web site, or you can go to a carrier store or a local retailer and buy your phone and minutes in person. While most carriers have simple plans where you just buy minutes as you need them, others have monthly rates or auto pay options where your credit or ATM card is automatically charged a set dollar amount each month. As you make calls, the per-minute cost is deducted from the monthly amount until you have no more money or time left.
While you might like the idea of no hassle or commitment, you'll pay a price for that convenience. First of all, you'll probably end up spending more per minute over the long run than you would if you signed a contract. This is especially true for anyone who uses a cell phone several hours a week. While you can get as low as 10 cents a minute with some prepaid carriers, there are often additional costs such as daily access fees (sometimes as much as $1 a day) or minutes that expire after just 30 days. On the equipment side, prepaid-only carriers typically don't have the latest bleeding-edge phones, and the majors will limit your handset choices. While some carriers are starting to break the trend (for example, the sleek Motorola Razr V3 offered by Cingular and T-Mobile, as well as Verizon's prepay Razr V3c), others offer little more than budget models. So if you're dying to get a smart phone such as the Trio 700w, you'll have to sign a contract to do so or pay a premium for an unlocked version. Finally, with some prepaid carriers, you won't be able to port your current phone number over to a prepaid phone--and you can't take your prepaid phone number with you to another carrier. Be sure to check first.
Most prepaid carriers charge anything from 10 to 60 cents a minute, depending on the plan--and there are a bewildering number of variations to consider. The bottom line is that there's no one prepaid carrier with an exceptionally good or bad deal, just a dizzying array of variations that may or may not make sense depending on how you use your phone. Read the fine print and consider the big picture before making your choice.
Of the major U.S. carriers, Cingular, T-Mobile, and Verizon now offer prepaid plans. Meanwhile, other companies without the network infrastructure of the big four carriers are getting in on the act. These MVNOs (mobile virtual network operators)--including Virgin Mobile, Boost Mobile, TracFone, and Liberty Wireless--buy huge batches of minutes from the traditional wireless carriers, essentially piggybacking on those networks to offer their own brands of pay-as-you-go wireless service. While MVNOs didn't used to have the extra services that the big carriers did, such as text messaging, ring-tone and gaming downloads, and Web browsing, that's beginning to change.
Cingular Go Phone After its 2004 acquisition of AT&T Wireless, Cingular not only became the largest wireless carrier in the United States, it also jumped into the prepaid market with AT&T's Go Phone plan.
While it's the smallest of the major U.S. wireless carriers, T-Mobile made an early and aggressive push into the prepaid playing field, especially by adding the flashy, headline-grabbing Sidekick II to its handset lineup; the sexy Motorola Razr V3 is a more recent addition.
A relatively late arrival to the U.S. prepaid arena, Verizon offers a wide network footprint and a growing 3G network; unfortunately, prepaid customers can't take advantage of Verizon's 3G V Cast service, even with the growing number of V Cast-enabled phones in its prepaid lineup.
Alltel A smaller carrier, Alltel's coverage is almost nationwide, but significant areas remain where only roaming coverage is available.
Boost Mobile An offshoot of the staid, business-focused Nextel, Boost Mobile is a "lifestyle based" MVNO carrier that's aiming squarely for the youth market. Armed with snazzy versions of Motorola's sensible handsets and push-to-talk (PTT) walkie-talkie functionality on Nextel's I DEN network, Boost offers some features not available on Virgin Mobile.
Liberty Wireless Launched in 2002 by In Phonic, a U.S.-based online seller of wireless products and services, Liberty Wireless offers a generic, stripped-down prepaid service through the Sprint PCS network.
TracFone Wireless A subsidiary of Latin American wireless giant America Mòvil, TracFone offers a bare-bones prepaid service that doesn't have the bells and whistles of youth-oriented MVNOs such as Virgin Mobile or Boost; however, it has a large national service footprint thanks to its agreements with a variety of wireless carriers, and its phones are available in more than 65,000 retail stores.
The benefits of these hands-free, wireless devices are obvious, particularly in the wake of state and local laws that require the use of a headset while driving. And just as the number of headsets has exploded, the number of Bluetooth cell phones has increased as well. Integrated Bluetooth is now present in a broad range of cell phones--from high-end smart phones to low-end functional models.