My first cellphone was with an Irish provider—despite the fact that I lived in San Francisco at the time I bought it, and had no plans to move back. It was (is) still worth it to have that phone, because I use it on a pay-as-you-go basis. This has worked extremely well for several years.
In the US, however, pay-as-you-go seems to be outside the mainstream. When I was getting a phone, I looked into the Cingular prepaid offerings; at the time I didn’t like them. Now, however, I’m strongly considering switching. (Also, some of the major pay-as-you-go services like Virgin Mobile, use CDMA networks, and I prefer GSM, not least because I use the same handset in the US and Ireland and want to continue doing so.)
The main reason I prefer pre-paid/pay-as-you-go is because “minutes” aren’t fungible assets in the phone company world. If paying-as-I-go means I pay the phone company according to how much of a service I use, then a monthly payment should entitle me to a certain amount of service usage. But for the plans I’m aware of, this only applies to talk minutes. And these minutes can’t be applied to something else. For example, it seems pretty obvious to me that text messages should ‘cost’ some number of minutes, and that long distance calls should ‘cost’ some multiplier of minutes. But no. I pay what comes to more than $50/month, and they give me more minutes than I’m ever going to use—but I have to pay extra for any international calls, and extra for all text messages—including the ones I receive, and rates are doubled (both ways) for international text messages.
Truly adding insult to injury, I just looked at Cingular’s current pay-as-you-go plan and discovered that the rates for a pay-as-you-go user, someone who pays nothing to Cingular each month, the rates for texts is half what it is for me. So I’m paying them $50/month in order to have the privilege of paying them extra for text messages.
In the eight or nine months that I’ve had a cellphone in the US, I’ve never come anywhere close to using all my minutes. And I took their cheapest monthly plan. Non-fungible minutes wouldn’t matter so much if cheaper monthly (minute-based) plans were on offer.
Clearly I need to change plans. Is it fair to blame the phone companies for pricing they can get away with? Nobody forced me to sign up with Cingular, right? True, but there’s not that much competition, either, and the GSM requirement eliminated a bunch of pay-as-you-go options. But when my contract is up, I’m going to look very closely at switching to their GoPhone plan.
This is assuming I even have the option of doing so. I have this worry that I’ll try to do it and find out they only offer it on certain phones, to new customers, or something. Also, it’ll be rather a while before I can get out of my contract—another area where I’m on the fence between “caveat emptor” and “there clearly isn’t enough competition here, bring on the regulators!”
Hopefully, competitive pressures will force the phone companies to eventually offer plans that allow consumers to pay something closer to the value of the services they actually use.
I know I’m probably anomalous in my usage patterns, in that I don’t talk on my cellphone all that much. I don’t use texts that much in this country either, but that’s partly because of my objection to the billing structure—and partly because most other people don’t text much either, again influenced by the fact that the billing structure encourages them not to.