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Are high-end handsets good for prepaid?

We talked recently about how Sprint is focussing on the top and bottom of the market with their 4G WiMax service and dual-headed prepaid division, featuring Boost Mobile and Virgin Mobile. But they’re keeping these entities separate. WiMax customers will deal with Clearwire, a Sprint partner. They won’t be sold prepaid wireless plans. Prepaid customers will continue to deal with Boost and Virgin. They won’t be targeted, necessarily, for WiMax. Yet one research executive thinks that high-end handsets are a good thing for prepaid.

Allen Hepner, executive director at New Millennium Research, believes that prepaid companies offering high-end handsets are only helping themselves. (via Cellular-News).

“The bottom line here is that prepaid no longer means low tech when it comes to phones. One of the biggest raps on prepaid phone service was that the phones were behind the state-of-the-art handsets. Many consumers who were outside of the traditional prepaid consumer profile no doubt were put off by the notion of ‘going backwards’ in cell phone technology in order to use a prepaid service. The good news for those consumers is that the prepaid industry is catching up and can now cater to their needs.”

The problem is, the biggest prepaid carriers typically do not carry high-end handsets. They might carry a perception of being high-end, because of features like QWERTY keyboards and touch screens, but compared to the rest of the market the listed phones just aren’t “state-of-the-art.” Hepner highlights the Samsung Finesse and Instinct, but they’re hardly high-end. Compared to other prepaid handsets maybe, but they’re still far behind the newest wireless devices.

Perhaps this is a language thing. Hepner says high-end, state of the art handsets. I say they’re regular old, mid-range handsets with a few bells and whistles. If they’re helping the prepaid market, that’s a good thing. But they’re far from the top of the cell phone market.