Is the Pay-as-you-go Cellular Future Already Here?

October 14, 2010

In the course of our discussion yesterday that was part of her column on new cellular pre-paid plans, financial wiz Jean Chatzky asked me a great question: Why would anyone need a 2-year contract plan anymore? As her post (and stories like the one I recently wrote for PC World) points out, with better phones entering the pre-paid arena, the allure of the “discounted” phone that you get with most 2-year contract plans may be rapidly fading.

Though big carriers like AT&T and Verizon love the postpaid plans (because they lock customers in to a predictable revenue stream) you may see the larger providers offer even more flexible pricing plans in the near future, especially as they roll out their newer, faster “4G” networks. While the big boys may not be able to match their upstart competitors on price, at least customers will have more chances to switch between providers when not locked in to a long-term deal. For most everyone who can survive without an iPhone, that’s good news.

Next week at 4G World in Chicago we are scheduled to meet with both Clearwire and MetroPCS, both of which have pre-paid plans already using their respective 4G networks. It will be interesting to hear from the companies how the 4G prepaid plans are doing so far, and if there are more in the works for the near future.

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