There are numbers of reasons why most people nowadays choose to stay with pay-as-you-go cell phones. It is a lot easier actually to deal with pay-as-you-go package as it is all up to you to continue or discontinue the service. The utility is provided to you on a short term basis, in other words you are the boss. If you do not feel like it, you can always switch between networks and retain the mobile phone numbers. You can also choose to let the service expires on its own and you do not have to worry of the consequences. This is perhaps the most acceptable reason why pay-as-you-go cellphone plan became a hit when it is first introduced (if I am not mistaken it was somewhere around 1993). Nevertheless, we need to first define what does it mean by pay-as-you-go plan and what makes it such a difference with standard contract plans. We will also try to analyze the concept behind the plans and perhaps we can compare which plan is the best bet to go with.
Let's us start with defining the term "prepaid mobile phones". Oh yes before that I should tell you that it may surprise you that pay as you go mobile phone plans are not that popular in the United States but they are rapidly gaining steam there. I will tell you why that is later. Prepaid services are more popular throughout Europe and asean countries. Ok sorry about that let us go back to our discussion. Prepaid mobile phones are best defined if I explain about their standard plan. Yes standard plans are well-known in the US as they actually involve a mandatory long-term contract, normally between one or two years. As far as I am concern, the monthly fees range from $20 to $35 dollars. With that price, you should get somewhere around 300 minutes of airtime. More can be purchased for higher fees though. Mind you though that contract-based plans are available for purchases only if you have a credit card.
Prepaid mobile phone on the other hand is completely different in terms of pricing model and also value added services. With pay-as-you-go mobile phone, you are not bound to any contract. You can terminate the service at anytime or you can just let it expires if you change your mind about the service. You can say goodbye to the typical fine or penalty of $100 dollars or £30 that comes with boring contract-based plans. Though they have some benefits like free weekends and evening calling that do not count towards your alloted minutes, they are not that attractive to those who do not really into communicating through cellular phones such as me. I rarely use my cell and I only spend about 60 to 90 minutes on the phone.
A user can add more credit to the pre paid account at any time by topping up the account. This can be done either through a credit or debit card transaction with the carrier (performed on the phone itself using text instruction or via a third party such as a shop or ATM) or by purchasing a plastic phone card which you can get at retail store such as Target. The top-up card is stamped with a unique code (often under a scratch-off panel) which can be redeemed on the phone for credit. Credit for a pay-as-you-go mobile phone may have a time limit, for example 90 days from the date the last credit was added. In these cases, customers who do not add more credit before expiration will lose their remaining balance, and their service (and its associated phone number) may be discontinued.
Prepaid wireless phones are better than long-term contract phone plans since they are really flexible. You do not need to have a credit card to obtain it and this is why it has gaining a lot of interests from teenagers who lack credit cards. You can just purchase the phone card from the market which is like giving the carrier money towards your account. However you must first purchase a cellphone made to use with pay-as-you-go cell phones plan. The phone needs to be made for the carrier you will be using and please hang on as we will discuss about that in a moment.
Most people are allured to pay-as-you-go mobile phone plans due to our human instinct have long been telling us to not to be bound by anything and a long-term blood s*cking phone contract is definitely one of them in the top list. For instance, if you go over your airtime allocation you will likely be charged a premium rate for each additional minute. If you do not use all your minutes they normally do not roll over where you just lose them and start over the following month. There are though certain carriage service providers that have started to learn to take into account changing monthly habits by offering flexible cell phones plan. There are also those that offers rollover feature, but overall many carriers have their own combination of features to choose from. These plans sometimes can present so many options and contingencies that some people can find it quite confusing; another reason to stay away from standard plans.
Another point why I prefer to use pay-as-you-go cellphone is because I do not have to deal with credit issue. Yes this is also why other people did the same thing. Most contract-based plan require you to have good credit records. In other words, if you are a good paymaster and you love using fancy and sophisticated phones, you can go ahead and subscribe with standard contract-based plans. I simply do not go for it, as there is possibility that in the future I change my mind about using the product and by the time it would be too late. Switching or terminating the contract before the due date would mean I have to pay for the penalty.
I hope that I have managed to give you a clear crystal view of what pay-as-you-go cell phones are and how it works. Now we can start comparing the pricing models for individual plans, family plans, and also business plans. Another fact that I want to share with you guys is that almost two thirds of all mobile phone accounts worldwide are pay as you go plans. In fact, the numbers can go even more if pay-as-you-go plans can be introduced earlier since long time ago when pay-as-you-go cellular phones were first introduced, the underlying products were hairpin solutions meaning that it took two extra dedicated trunks on the cellular switch to make one call, one for the inbound connection to the telephony platform and the second back to the switch to complete the call. Trunks used to be an expensive resource back in the early days and hence carriers chose to stick with postpaid plans.
As I mentioned before, for users to use pay-as-you-go cell phones, they must first purchase the right phone. T-Mobile phones are leading brands in the UK and I believe it is catching up in the US market lately. Let us take a look at certain packages offered by T-Mobile in the United Kingdom. For the purposes of this analysis, I am going to choose the most expensive pay as you go plan from T-Mobile in the UK. The phone for this plan is Sony Ericsson W880i that comes in silver colour. The price is £99.99 and this slim, sexy 3G mobile phone is superbly fast when accessing internet using "web'n'walk". This phone is definitely the choice for those who love phones and advanced technology items (not for me though lol). Now that we have selected our phone, take a look at the plan where it only cost you 10p per text. You will also get a free reward every time you top up and you can always get a cheaper rate when you need to call your friends or family abroad. These are called Boosters and Passes and once you have chose your phone and plan, you get just purchase it online. Bear in mind though that there are delivery cost as well when you purchase it online, so make sure you check everything first before you make any payment.
The cheapest one from t mobile UK is KP100 phone model from LG. When you buy this prepaid cell phone, you can top up £10 and get another £10 free from T-Mobile. Your airtime can go longer with Booster value added feature and later you can just checkout and with this phone, it only costs you £16.98 to activate and you can start using the phone. There is also an option for you to upgrade your phone plans. I will also discuss about this in my next post. I am particularly fond with the new T-Mobile G1 which has three different set of navigation options.
There are also few disadvantages of using pay-as-you-go cell phones but relatively you still save your money more when you use it, rather than paying ongoing billings to telecommunication providers. The call rate and texting may cost you slightly higher than normal post-paid plan.
I am a Chief Mobile in Mymode Network and my aim is to provide useful information about prepaid mobile phone and its advantages.