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Verizon, AT&T and others still struggle to attract new subscribers

The economy is finally seeing recovery after quarters of disappointing figures, but AT&T and Verizon Wireless are still finding it difficult to woo new wireless subscribers.

Verizon signed 423,000 customers to postpaid contracts, while AT&T added 512,000 new subscribers.  AT&T’s new subscriber base saw a 43% decline compared to one year ago, while Verizon's 423,000 tally was a 55% drop compared to 2009.

Rather than latch on to costly two-year phone contracts, many wireless customers are now choosing prepaid wireless phones. The use of a prepaid plan allows owners to pay just for the minutes and data they use, which is especially helpful as many Americans continue to closely watch their budgets.

Unfortunately for wireless carriers, prepaid phone plans offer less profit for the host companies -- which is exactly why all four carriers offer phone specials, buy-one-get-one promotions, and other incentives to get customers hooked into long-term contracts.

AT&T is expected to again add more prepaid phone owners than postpaid customers in the next quarter -- a troubling trend for the carrier that has exclusive rights to the Apple iPhone.  Verizon continues to seek out the iPhone, though AT&T and Apple still reportedly have a strong working relationship. However, a possible Verizon-Apple partnership will be a significant victory for Verizon.

Verizon has used the Google Android mobile OS for several major smartphones, including the Motorola Droid and upcoming Droid Incredible, though the company understands the consumer market is rather fickle at the moment.

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prepaid - only for those that dont use their phone
By vapore0n on 4/28/2010 8:27:36 AM , Rating: 3
I just went to the ATT site and the plans really dont look that good if you are planning on actually using your phone.

A prepaid plan worth 39.99 includes a lot less minutes than a 2 yr contract plan of same price. Of course you are not bound to a contract, but are bound to att and the crappy prepaid phones.

The cheapest pay as you go plan of 3$ per day you use your phone sounds interesting, but only if you use the phone 5 days a month.

By michal1980 on 4/28/2010 8:47:47 AM , Rating: 4
Thats because ATT's plans suck.

Its true if your a heavy phone user Post Paid/contract is the way to go.

Me and my wife however each use ~1000 mins/year. Currently we use t-moblie pre-paid. I get 2 refill cars a year at an msrp cost of 100 bucks (and I can always time it to get them at least 10% off, if not more).

So our yearly phone plan cost at 200 bucks. or 17 dollars a month. can't beat that for our use. Yes I would like a nice data phone with internet, and I would use that. But if I can save a few hundred dollars a year and use that for a short vacation, that provides me far great value.

Plus I dont 'pay' any extra taxes/fees on top of my plan. unlike those 50 dollar a month plans that turn into 70 dollars a month.

By barjebus on 4/28/2010 12:51:28 PM , Rating: 2
I'm in Canada and am eternally frustrated by the fact that in the area I live, our GSM provider requires you to top up monthly. I have a sim card embedded in a GSM receiver that is wired to a remote car starter. I only use this device in the winter, and it never actually consumes minutes...yet I must top up my account with 10$ worth of credit every month even though I never use it.

The device itself notices that a call is incoming to it and activates, so it never really completes the connection and never consumes and minutes.

By Hieyeck on 4/28/2010 4:01:42 PM , Rating: 2
Um... If you're talking about Rogers, you need to look more carefully. I buy a $100 top up (you'll have to go to a rogers store and they print it out on a receipt) and it lasts for a year. that's... $8.33/month? Conversely, you can sign up for auto-renew and then cancel every winter...

By mcnabney on 4/28/2010 9:06:45 AM , Rating: 3
Wireless companies make plenty of money off of prepaid. The reason they want customers under contract is that prepaid customers drop service/change carriers at a much much higher rate. Would you really want to spend all of that money attracting a customer and subsidizing a device for a customer that will deactivate in five months when you could be going after customers that will be with you for at least the term of the contract?

By michal1980 on 4/28/2010 11:26:46 AM , Rating: 2
The pre-paid phones are general very basic. I doubt they are subsidized much at all.

They want contract people because on average your contract person is paying ~$3/mintue

By iFX on 4/28/2010 9:16:04 AM , Rating: 2
Straight Talk

$45 month, all fees and taxes included.

Unlimited Minutes
Unlimited Text/SMS
Unlimited Data

I use my phone a LOT, sonny boy.

By CSprepaidUser on 4/28/2010 9:47:50 AM , Rating: 3
Actually, it's just that AT&T's prepaid plans are not all that great. They offer the 10c per minute call rate I get at NET10 ONLY if you pay their 'daily access fee' of $1. Come to think of it if you use your AT&T gophone on that plan say, once a day for 20 days of the month it would be ridiculously expensive.
Like I said, with NET10 I pay 10c per minute WITHOUT any daily fee. Granted I'm not a heavy user, so my monthly expense is usually $30 spread over two months.
If you're a heavy user you can choose between the many unlimited prepaid plans out there...

Unless you base your choice of cell provider on the device you get, I don't think there's a single contract plan out there that can't be beaten by a prepaid one.

By TheRequiem on 4/28/2010 10:34:49 AM , Rating: 2
Just go with SPRINT, they have Boost mobile and virgin mobile and the cheapest rates.... Also, there network is better then AT&T's prepaid network...

By puplan on 4/28/2010 8:54:24 PM , Rating: 2
I second that. Boost prepaid lets me have a cell phone for $3.33 a month. There is enough minutes for emergency use, synchronizing kids pickup, shopping list addendum, etc.

By Denigrate on 4/28/2010 12:04:29 PM , Rating: 2
Been using T-Mobile's prepaid plan for a couple years now and have had zero issues with it. My wife and I both have one and I buy my wife a $100 refill with 1,000 minutes about once a year and I buy one about every six months. We have these phones for our convienence and basically don't give out the number. We use Ooma at home so basically use the cells on trips and for in case of emergency calls like if the power goes out. I'll admit, the most minutes probably get used when one of us it at the store and we forgot to get an item on the list.

By marvdmartian on 4/28/2010 11:46:29 AM , Rating: 2
Well, yeah, but not all of us are addicted to our phones, ya know?

I bought my GoPhone a few years ago, when I was between addresses and didn't want to be out of touch. I kept it for those times when I'm away from home, for the same reason (and because making credit card phone calls puts even cell phone plan costs to shame!).

AT&T offered me 2 plans when I bought my phone:
1. 25 cents a minute, no daily charge
2. 10 cents a minute, $1 daily charge for any day I use the phone.
I went with #2, because most of the time, if I'm going to use the phone, I'll use it for longer than 6 minutes (pretty much the break even point between the 2 plans).

But I use my phone for 2 things, to make phone calls, and to receive phone calls. I don't do texting, I don't need a data plan, I don't require a way for people to send me pictures, and I don't need to take pictures with my phone. I have other technology that does all the things I don't need my phone to do, and they do them much better than a phone can.

And I probably don't go through more than $125/year using my prepaid phone, and that's during a heavy use year. So yeah, I don't use my phone much, but I only pay around $10 a month. Beats the hell out of any post-paid plan, and for every $100 I spend, they give me $10 worth as a bonus. Oh yeah, and I'm still using the same $15 initial cost phone after 3 years.

Works for me!

By wifiwolf on 4/28/2010 12:52:44 PM , Rating: 2
I just wonder what kind of management problems US is facing.
Here prepaid is much more used than contracts.
I've got a prepaid plan in which I'm only forced to pay 10€ a month and have:
Free calls (GSM), video calls (3G), and text to everyone that has the same plan as I do in the whole carrier.
Free mobile live messenger.
And 0.20€/min to other destinations.

Doing maths - 50 additional minutes a month for every other people I should need to talk to.
Actually I never needed that much since I almost always only need to talk to my closest ones and they all have the same plan as I do - so we talk as much as we want and for 0€. I'm stockpiling credit should sometime in the future I need it ;)

By Xaussie on 4/28/2010 8:04:25 PM , Rating: 2
I found AT&T were the cheapest. $100 prepaid which lasts one year before expiring, so we end up paying about $8 a month per phone compared to $70 a month with the contract with two phones. That's a saving of $54 a month for us, or over 70%.

Switching was easy too, kept the same phones and the same SIM modules and just called them to switch it over. We had to pay about $200 in cancellation fees on the two year contract but with about 10 months left on the contract it didn't make sense to let it play out.

Of course we don't use the phones for chatting or surfing the web, just to the point information calls. My Blackberry gets Wi-Fi just about everywhere too so I don't need a data plan (don't forget to ask them to switch off data access).

It's a wake up call
By Floridian on 4/28/2010 9:37:22 AM , Rating: 2
So they finally woke up. After droves of customers like me fled to prepaid for better prices and, as in my case, just as good reception. I got Net10 prepaid and I've never regretted it for a minute. I'm saving hundreds a year.

RE: It's a wake up call
By Anoxanmore on 4/28/2010 9:51:04 AM , Rating: 2
That is because you don't make phone calls with your phone.

RE: It's a wake up call
By frobizzle on 4/28/2010 7:29:04 PM , Rating: 2
That is because you don't make phone calls with your phone.

Are you really that stupid or just blatantly arrogant?

Not everyone needs to blathering away on a cell phone for 2000 (or more) minutes a month. I average around 350 minutes a month and pay 10 cents a minute with Tracfone. And since they piggyback primarily on Verizon's network, I get great coverage almost everywhere.

i don't even want to know...
By inperfectdarkness on 4/28/2010 8:57:28 AM , Rating: 2 much data plans would cost for prepaid. i don't know how you can beat sprint's prices for truly unlimited data.

RE: i don't even want to know...
By mcnabney on 4/28/2010 9:03:04 AM , Rating: 2
You never get more than what you pay for, and you are usually stuck with much less.

I have had T-Mobile and am now with Verizon. One thing hasn't changed. I still let all of my friends with Sprint use my phone because most of the time their phones don't work. When I call them I almost never get through and have to leave VM because wherever they are they don't have a connection. In almost everything in life, if the product is made for a low price point don't expect much in the way of performance or reliability. Did I mention that I live in Sprint's home town?

Rolling contracts
By alanore on 4/28/2010 9:48:30 AM , Rating: 2
Its likely that you'll start seeing a similar thing as we have in the UK. Rolling Pay-As-You-Go (Prepaid) contracts. It basically a prepaid contract but if you top-up a minimum amount each month, say £10, you get a bonus, like 200 free text and 500Mb of data. If you don't top up that month you simple don't get the bonus.

You can still get rid of the contract at anytime, but if you top-up monthly you get a deal thats better than Medium to Low end Pay-Monthly contracts at the cost of non-subsidized phone.

By allhew on 4/28/2010 2:14:34 PM , Rating: 2
As a prepaid cellphone user I am delighted to hear that I am not as profitable as a contract user. We all know that cellphone contracts are a licence for the operator to rip you off. This is clear proof that anyone who signs a contract now is nuts.

Virgin Mobile
By jrb531 on 4/28/2010 2:20:34 PM , Rating: 2
20 cents per minute. $20 top off every three months and any minutes you do not use roll over.

It can't be any simpler than that.

Now if you talk alot (and many do) then you'll want a regular plan but if you use a cell phone just to communicate what is "needed" and not used to pass your boredom, then you can save a ton of money.

Prepaid plans rock
By chitchatgirl2 on 4/28/2010 6:48:41 PM , Rating: 2
Prepaid is so much better than post! Ever since I switched to Fuzion Mobile I save so much money on my smartphone, with no contracts, no roaming, unlimited talk and text, the whole thing for only $50 a month! Check them out! I really like them!

By Rosie on 4/29/2010 4:03:27 AM , Rating: 2
I put my kids onto Net10 Thank God as they seem to text day and night! Their texts only cost 5c each and their calls 10c per minute but I shudder to think what size cell phone bill we'd get if they were on contract! I think a feeling of being in control of one's finances and not being in debt is the prime reason that people are moving away from contracts to prepaid!

By EngineerGal76 on 4/29/2010 8:53:38 PM , Rating: 2
I had AT&T for practically my entire life. Didn't mind the service, but the bills just seemed to get higher and higher each month. I switched to prepaid, Net10, in August and couldn't be happier. NO more monthly cell bills! I pay just 10 cents/minute and 3 cents/text. I am saving so much and my phone with the service is a high quality Samsung. Its really an impressive service. I give Net10 two BIG thumbs up :)

By kcgomez83 on 5/5/2010 10:20:01 PM , Rating: 2
I was a contract carrier for years with AT&T before I decided to switch to prepaid because I just couldn't save and keep up with the fees. While I was skeptical, I did switch to Net10 and happily, the service has made me so glad I did. In terms of prepaid, their plans really can't be beat if you need to save - plans start at $15 and there are no contracts. I've been able to save more than $75 a month as well purchase a much less inexpensive phone and best of all, Net10 hasn't compromised any of my calling network quality. Net10 is a great choice for anyone needing a low price, basic plan.

By lbishop on 5/14/2010 4:24:18 PM , Rating: 2
PlatinumTel is another prepaid provider that offers valuable plans and unlike some other providers don’t have roaming fees (which can really add up in areas where the network isn’t available.) Their unlimited monthly talk/text plan is just $50, and for just $10 more includes unlimited mobile web with high speed EVDO service available. They also offer a pay as you go plan for as little as $5 monthly.

Fuzion Mobile for Prepaid
By Jameichat on 4/28/2010 6:35:47 PM , Rating: 1
Fuzion Mobile is the latest player that has no pin codes or contracts- they have an unlimited plan AND the top smartphones work. You don't have to have a lousy phone with Fuzion Mobile- ANY SIM card enabled phone works! Check out Fuzion Mobile- New things constantly being announced!

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