> However, if you look, all the prepaid plans that I've seen look
> suspiciously
> like predatory pricing. The price per minute is substantially
> higher than
> an equivalent minute on a conventional plan. Picking on AT&T, for a
> minute,
> here, look at their monthly GoPhone prepaid plan, $39.99/300
> anytime, vs
> $39.99/450 minutes for the normal. If anything, the phone company
> is not
> extending you any credit, and has actually collected your cash in
> advance,
> so the prepaid minutes ought to be /cheaper/.I disagree. Ever heard of volume discounts?
Picking on at&t again, a typical iPhone user signs up for 24 months @ ~
$100/month, _after_ a credit check to prove they are good for it or
plunking down a hefty deposit.Compare that $2.4 kilo-bux to the $40-one-time payment by a pre-paid
user. Or, to be more far, how about $960 ($40/month for voice only)
compared to $40 one-time?Hell yes I expect more minutes per dollar on my long-term contract.
Hrmm, wonder if someone will offer pay-as-you-go broadband @ $XXX (or
$0.XXX) per gigabyte?
Actually, I was fairly careful, and I picked monthly recurring plans in
both cases. The typical prepaid user is NOT going to pay a "$40-one-
time" payment, because the initial cost of the phone is going to be a
deterrent from simply ditching the phone after $40 is spent.
The lock-in of contracts is typically done to guarantee that the cell
phone which they make you buy is paid for, and it is perfectly possible
(though somewhat roundabout) to get the cheaper postpaid plan without a
long contract - assuming you meet their "creditworthiness" guidelines.
Even without that, once you've gone past your one or two year commitment,
you continue at that same rate, so we can still note that the economics
are interesting.
The iPhone seems to be some sort of odd case, where we're not quite sure
whether there's money going back and forth between AT&T and Apple behind
the scenes to subsidize the cost of the phones (or I may have missed the
news). So talking about your iPhone is pretty much like comparing Apples
and oranges, and yes, you set yourself up for that one.
To put it another way, they do not give you a better price per minute if
you go and deposit $2400 in your prepaid account. You can use your volume
discount argument once you come up with a compelling explanation for that.
... JG