Official Prepaid iPhone Soon Available in the U.S.?
Why Apple needs to market their phone to no-contract customers.
It seems to be odd to see the iPhone as a prepaid device, but it is possible, that Apple will enter this market, soon. And this is why:
The Prepaid Market is Growing
Prepaid plans gained popularity throughout the US in recent years due to new competitors, aggressive pricing and the recession, which caused many American customers not to qualify for traditional cellphone contracts.
Today, many Americans choose prepaid plans because they offer better rates than their postpaid counterparts. Some prepaid provider are offering unlimited nationwide calling, 3G internet usage and text messages for $50 per month or even less.
Next to the reasons shown above, people still choose prepaid plans to keep their costs under control or because they do not want to be tied up with a long term contract.
The Competition
In January, Android overtook Blackberry in the market share and is the most popular smart-phone platform ever since. Several prepaid providers are offering packages with Android devices and pushing the market share for Google's operating system even further. While Android gained rapidly, the iPhone market share did not change significantly. On one hand, it shows, that Apple can count on a loyal customer base. On the other hand, Android's rapid growth is putting Apples leadership in available apps in jeopardy. Losing the leadership here can result in loss of market share on the long run.
The Only Chance
Apple has to provide the iPhone for the prepaid market as long as the brand is still in its peak and before the Android Market offers more apps than the App Store.
Most providers are already offering non-contract Android phones or are expected to do so, soon. The former exclusive iPhone partner AT&T is no exception.
Plans and Pricing
It is not very likely, that we will see a prepaid iPhone 4 anytime, soon. The iPhone 3GS is the best candidate to be offered without a contract. If this device is sold to prepaid customers, it would be probably priced between $200 and $400. Refurbished devices may be offered for less.
How the prepaid plan will be priced is depending on the provider. The problem is, that not every provider is able to provide the proper service for a refurbished iPhone 3GS. The 3G internet connection can only be established using the AT&T network. If Apple chooses to go directly with AT&T, they have to negotiate the plan pricing, because AT&T's smartphone plans are by far not as attractive than many competitors.
After negotiations, AT&T will for sure adjust their pricing, somehow. But it is not very likely, that they will offer an "everything unlimited plan" for less than $60. Under $60, AT&T may offer unlimited data but would charge for other services.
[Update]
There are rumors throughout the web, that apple will introduce a stripped down iPhone. Recently, Bloomberg reported that Apple is said to work on a smaller and cheaper phone called iPhone Nano.
Even though it is very likely, that somebody made up the name, a smaller and cheaper device would be a perfect match for the prepaid market.
References:
- ComScore.com: Mobile Subscriber Market Share Report
- Androidpolice.com: Number of apps in Android Market rapidly gaining
- Boost Mobile prepaid plan. $50/Month or less for unlimited nationwide talk, 3G internet and text. Fee can shrink every 6 month by $5 down to $35.
- T-Mobile Prepaid Plans with android phones.
- Virgin Mobile USA Virgin Mobile USA is offering unlimited nationwide talk, we and text for $60/Month. For $40/Month 1200 minutes talk and unlimited text and web. Android phones are available.
- Verizons New prepaid Plan "Unleashed" offers unlimited text, talk and web for $50/Month
- Straight Talk Prepaid Plans unlimited text talk and web for $45/Month
- Metro PCS is offering different Android Phones. Some even with 4G internet connection. They are offering a prepaid plan with unlimited nationwide talk, text and 4G internet for $60. Smaller plans available.
- AT&T's Prepaid Plans are not as attractive as the competition.
- [Update] Bloomberg: Apple Is Said to Work on Cheaper, Smaller IPhones
