media logos

Could low-end smartphones be prepaid’s answer?

Over the past few years, prepaid has made quite the metamorphosis. Once a last resort for folks with poor or even no credit, it has turned into a true cost-saving alternative. It has its pros and its cons, but it is more useful for more people now than it was three years ago. So what’s the next step for prepaid? Well, in addition to unlimited calling plans, we’re starting to see some data plans emerge. What good is a data plan, though, without a proper device? Prepaid needs some low-end smartphones.

Thankfully, they might be on the way. Motorola, which is about to roll out its first Android-based phone, plans to target the low-end smartphone market. It won’t attempt to out iPhone the iPhone, nor become more of a business staple than the BlackBerry. Instead it will cater to the lower end market, and those handsets could be perfect for prepaid.

One of the biggest issues with prepaid smartphones is the price. Postpaid carriers subsidize handsets with two-year contracts, so the retail price of these devices is usually never realized. On prepaid, though, those subsidies are fare lower if they exist at all. By focusing on low-end smartphones, Motorola could create a product which would fit perfectly with the prepaid scheme.

It’s clear that they will make these handsets, and it’s clear that they could work on prepaid. But will they? Thankfully, we’ll have some time between now and then to reassess the prepaid sector. Something tells me, though, that low-end smartphones could be a good idea.