Comments on: Why there might not be a price war in prepaid unlimited

By: Peter Kent

Peter Kent — Sat, 25 Jul 2009 10:29:09 +0000

Ten cents is the benchmark for per minute rate rollover type plans, not heavy minutes that disappear at the end of a 30 day cycle plan. Don’t confuse the two. Net10 set the standard, Boost Mobile copied it on their Pay Go plan and most of the other Big prepaids have some variation of it: Virgin Mobile’s $20 pack buys 200 minutes at $20 or 10 cpm, Att has a 10 cpm option (after you pay a buck for daily access), Tmobile prepaid allows 10 cpm if you buy 100 bucks or a thousand minutes at once, Verizon has 10cpm after you pay 99 cents a daily access much like Att.

The argument about a lower benchmark holds no water considering that non conditional 10cpm flatrates don’t exist for most of the biggies. You either have to buy a lot of minutes or you have to pay some kind of access fee to get to them. 10 cpm is a good deal and an easy watermark to remember. Att and Verizon still charge 25 cpm for their non access fee flat rate, Tmobile and Tracone charge 33 cpm on their lowest priced cards. Compared to that, a dime is a bargain.

By: Ash

Ash — Mon, 13 Jul 2009 20:04:33 +0000

The benchmark needs to be thought in business terms.

10 cents is the benchmark for pay as you go plan rates; the consumer draw is merely that rate and typically an occasional user or one that does not want to shell out for more.

However, in the $30 per month context, the rate diminishes, yes. But the upside for the seller is that they get a monthly sum from you. The $30 customer is more valued that a $0.10 customer in terms of revenue. The seller is rewarding the user with a lower per minute rate for taking a larger commitment.

This is no different than in postpaid plans where lower plans (e.g., $30) are more expensive per minute than more expensive plans.

By: Ken

Ken — Sun, 12 Jul 2009 14:00:01 +0000

Peter I wouldn’t say that the benchmark for minutes is 10cents because the other Straight talk offer which is not mentioned in this article is 1000 minutes, 1000 texts/mms and 30m of data for $30 per month. When you calculate that it works out to 2 cents per minute, 1 cent per text and the data is free, now that’s way cheaper than your benchmark and a better offer than any contract is giving.

By: Peter Kent

Peter Kent — Fri, 10 Jul 2009 20:23:57 +0000

Good article Joe. Methinks the price war is slowing down or at least stabilizing.
$45 is really much less then $50. I’d still say that for unlimited plans, $50 remains the benchmark (Kajeet launched a trial unlimited talk/text at that point early this week).

For per minute plants, I’d say the benchmark is 10 cents a minute. With the price wars heating up around the unlimiteds, the per minute stuff is kind of getting overlooked.

In this economy (that term is rapidly becoming cliche, but then again cliche is just the truth being repeated), certain terms like price cuts, no extra charge, free and unlimited all are big selling points with consumers.