If no contracts, no subsidies and unlimited use, then why Postpaid at all ?

[A Dude]

Over preceding decades, the model has always been Postpaid with credit check due to:

- Possible huge bills due to per-minute pricing of long distance phone calls for many decades
- 2 year contracts due to subsidized smartphone costs in the last decade

Now that there is unlimited calling plans and separate purchase of phones (as well as BYOD), then there seems to be no reason to pay after calling instead of before.

If one sets up Autopay, then it is pretty transparent to the user.

For mobile phone companies, wouldn't a 30-Day Float on the funds be worth dispensing with the credit checks and the pennies they get for one-time selling of that credit data?

[hyelton]

Over preceding decades, the model has always been Postpaid with credit check due to:

- Possible huge bills due to per-minute pricing of long distance phone calls for many decades
- 2 year contracts due to subsidized smartphone costs in the last decade

Now that there is unlimited calling plans and separate purchase of phones (as well as BYOD), then there seems to be no reason to pay after calling instead of before.

If one sets up Autopay, then it is pretty transparent to the user.

For mobile phone companies, wouldn't a 30-Day Float on the funds be worth dispensing with the credit checks and the pennies they get for selling that credit data?

General postpaid also means providing a free phone with bull credits and or discounted phone with bill credits. Still sort of like being in a contract


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[Qt0]

yes ^ those "billing credits" is nothing but another name for 2 (and in some cases longer) contracts.

[bobdevnul]

Over preceding decades, the model has always been Postpaid with credit check due to:

- Possible huge bills due to per-minute pricing of long distance phone calls for many decades
- 2 year contracts due to subsidized smartphone costs in the last decade

Now that there is unlimited calling plans and separate purchase of phones (as well as BYOD), then there seems to be no reason to pay after calling instead of before.

If one sets up Autopay, then it is pretty transparent to the user.

For mobile phone companies, wouldn't a 30-Day Float on the funds be worth dispensing with the credit checks and the pennies they get for one-time selling of that credit data?

Inertia is probably a large factor. That is the phone service someone setup years ago and has become just another monthly bill that is not scrutinized.

There are a large number of people who can't or won't just pay for an expensive phone up front/outright and feel the need to get their phone now and pay for it with their phone bill with "easy monthly payments" for two years.

The perception that prepaid is ghetto service persists, though to a lesser extent that some years ago.

There are a lot of people out there that get company subsidies to be on the corporate postpaid plan.

From the carrier's perspective, postpaid subscriber numbers, ARPU, churn is the gold standard that their value is judged by the business market. Postpaid subscribers have higher ARPU. Postpaid subscribers don't flit around much, drawn by the latest shiny object, especially if they are stuck with a device payment plan and ETF.

I personally don't care about a credit check, but haven't had postpaid phone service since the 1990s. My circle of friends and acquaintances could not care less what cheap prepaid service I use. It is not something we generally discuss. Though most of them are on carrier postpaid plans for the reasons I mentioned above.

[malet]

Most people would probably be better off financially using prepaid, but there are some other perks of postpaid like roaming and international usage that are valuable to some people.

[munkala]

Almost everybody I've come across are on postpaid unlimited plans with the 4 big carriers or Metro or Cricket. They have never heard of MVNO.

When I tell them I only pay $5/month on a smartphone with data, they think I'm out of my mind and dreaming.

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[hyelton]

Almost everybody I've come across are on postpaid unlimited plans with the 4 big carriers or Metro or Cricket. They have never heard of MVNO.

When I tell them I only pay $5/month on a smartphone with data, they think I'm out of my mind and dreaming.

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Well you are dreaming if the $5 a month includes data thats more than a gig with actual unlimited voice and text lol.


But the lower need users are unaware of how much they can save by switching to something like FreeUp which is $0 a month with 1000 min/text a month

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[munkala]

Well you are dreaming if the $5 a month includes data thats more than a gig with actual unlimited voice and text lol.


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Red Pocket. 100/100/500 plan for $5/month.

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[hyelton]

Red Pocket. 100/100/500 plan for $5/month.

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Sort of figured it was red pocket. Yeah it’s a great deal. But a lot that wouldn’t fit usage wise. But for a light user it’s amazing for someone that uses that and is probably paying $80-$100 a month postpaid


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[kevink1]

And I have this RP plan for my backup phone. Gave me the Verizon network if needed as backup for my ATT Prepaid line. Which has now been moved to Verizon prepaid, so when the year is up I may move that line to the ATT network

[lineisbusy]

Over preceding decades, the model has always been Postpaid with credit check ... Now that there is unlimited calling plans and separate purchase of phones (as well as BYOD), then there seems to be no reason to pay after calling instead of before.

I've wondered this myself. While, at first, I had reservations about paying in advance for any service, it seems clearly advantageous to prepay for phone service. In particular, it appears that prepaid customers are not subject to taxes and additional junk fees paid by postpaid/credit-check customers. Prepaid customers don't have to worry about being tied to a contract or having to worry about unexpected recurring charges, which can be hard to stop. And, as noted earlier in this thread, it's a lot easier to change to another provider.

Of course, mine is a minority view. I don't understand why people are willing to pay $500 to $1,000 for a smartphone (either bought outright or paid for over time through a contract) when they can own an unlocked phone for $100 or $200. But this speaks to the fact that a lot of people look at monthly cost instead of the total cost over time.

And, yes, as someone else has noted in this thread, when I tell people there are phone services that only cost a few dollars a month, they can't seem to understand how this is possible and they show no inclination to shift from their existing overpriced plan with a major postpaid carrier.

While there are occasional customer service issues with some of the MVNOs, they seem in many cases (not all) to offer better customer service than the big outfits.

Of course, if the blissful ignorance of most cellphone customers subsidizes or helps make our sweeter deals with the MVNOs possible, let them continue to overpay!

[kevink1]

There can be issues with prepaid.

For instance, if you need to change your plan a few days into a cycle. Postpaid generally allows you to do it. The proration of the different plan costs will be handled on the bill. But many people on prepaid plans (I'm not claiming they all do this), when you change your plan, you may be throwing away the rest of the month on the old plan. Or someone changes it by mistake. No refunds in this case. (Though more postpaid carriers don't refund the remainder of the months service now if you leave before the end of the month).

Also, many prepaid services go on strict 30 day renewals. Which can cause difficulty for someone who doesn't get their pay until a fixed day of the month. So they may have started service on the 7th, the day they get paid, then the renewal comes due the 6th, and their money in their account is out. Of course, in the long run, spending more on postpaid to avoid this is costlier.

[Boz1]

There can be issues with prepaid.

For instance, if you need to change your plan a few days into a cycle. Postpaid generally allows you to do it. The proration of the different plan costs will be handled on the bill. But many people on prepaid plans (I'm not claiming they all do this), when you change your plan, you may be throwing away the rest of the month on the old plan. Or someone changes it by mistake. No refunds in this case. (Though more postpaid carriers don't refund the remainder of the months service now if you leave before the end of the month).

Also, many prepaid services go on strict 30 day renewals. Which can cause difficulty for someone who doesn't get their pay until a fixed day of the month. So they may have started service on the 7th, the day they get paid, then the renewal comes due the 6th, and their money in their account is out. Of course, in the long run, spending more on postpaid to avoid this is costlier.

But those issues are extremely mild, compared to the SIGNIFICANT savings, especially for lighter users, and IF you use a plan that closely fits your needs.

[brad4cell]

Like others have said one of the reasons is some people like to get an expensive phone cheap on contract.

However, the other reason I thought was roaming.

My brother has boost and even thou it is suppose to have roaming he is always having problems when traveling where he says he does not have a signal and he says his friends phone has a signal. I think his friend has verizon postpaid.

So if he got verizon prepaid I don't think it has roaming but verizon postpaid has roaming and probable has better coverage.

[Boz1]

Like others have said one of the reasons is some people like to get an expensive phone cheap on contract.

However, the other reason I thought was roaming.

My brother has boost and even thou it is suppose to have roaming he is always having problems when traveling where he says he does not have a signal and he says his friends phone has a signal. I think his friend has verizon postpaid.

So if he got verizon prepaid I don't think it has roaming but verizon postpaid has roaming and probable has better coverage.

But you're comparing rotten bananas to apples. Boost uses Sprint, which is arguably the worst network in the US. It might be fine in certain locations, but much worse than Vzw or a Vzw MVNO in others.