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32% of Q1 U.S. smartphone sales involved prepaid phones, up from 21% a year ago, says NPD. That...

32% of Q1 U.S. smartphone sales involved prepaid phones, up from 21% a year ago, says NPD. That trend could spell trouble for AT&T (T) and Verizon Wireless (VZ, VOD), whose recent growth has been heavily tied to selling costly postpaid data plans. With 72% and 61% of the carriers' postpaid bases now respectively on smartphones, they face pressure to gain prepaid buyers without cannibalizing postpaid subs. Cannibalization fears have led AT&T and Verizon to make their prepaid plans 3G-only; Sprint (S) and T-Mobile (TMUS) offer 4G. A mix shift towards unsubsidized prepaid phones could also be a challenge for Apple (AAPL), estimated to have just 8% of the Q1 U.S. prepaid smartphone market (though that's up 4x Y/Y).
Comments (16)
  • Your point, exactly?
    18 May 2013, 06:55 PM Reply Like
  • Aapl t and vz have prepaid issues on the horizon
    18 May 2013, 07:51 PM Reply Like
  • sounds to me that at 4 x last years rate Apples is growing faster than anyone in prepaid phones. So why should that hurt them?
    19 May 2013, 11:39 AM Reply Like
  • Because prepaid plans appeal to people who are more interested in "bang for the buck" than in owning the latest or "coolest" phone. Definitely not AAPL's strongest area.
    19 May 2013, 01:33 PM Reply Like
  • at&t and Verizon can buy prepaid companies or make their own cheap ones.
    18 May 2013, 08:14 PM Reply Like
  • I would think that Apple, AT&T, and Verizon would have this information long before these numbers were released.

     

    This being said, wouldn't these three have a plan in place to capitalize on this shift in phone sales?

     

    Prepaid makes sense for more and more people. Make it worth their while to go with your plan or phone. Seems pretty easy to me.
    18 May 2013, 08:18 PM Reply Like
  • Some of us don't use cell phones for much more than calling a sub shop before driving home, emergencies, etc. but still may want to check email, fantasy football scores, or the price of something on Amazon.
    I can get that for less than $9/month for 100 anywhere minutes per month from Tracfone (plus $45 for a lower-level smartphone (LG-800G). They, in turn, use one of the big companies for their transmissions so why can't the big companies offer such rates themselves?
    18 May 2013, 08:38 PM Reply Like
  • Who offers the best plan for a husband and wife? I feel like Verizon is ripping us off but don't know for sure.
    18 May 2013, 09:31 PM Reply Like
  • We are a household of two and use one smartphone and one prepaid super dumb phone. This works well for us, but may not for others.
    18 May 2013, 10:26 PM Reply Like
  • Is this not of Interest: "Cannibalization fears have led AT&T and Verizon to make their prepaid plans 3G-only; Sprint (S) and T-Mobile (TMUS) offer 4G".

     

    When China Mobile (CHL) is on the verge of negotiating for funding from the China Government and Apple to upgrade their network to a complete 4G system.....
    18 May 2013, 10:53 PM Reply Like
  • You really think T & Vz are going to miss out on this "cheap" business?, don't bet your wireless bill....but probably low profit, low priority for both...its coming...
    19 May 2013, 08:21 AM Reply Like
  • Its simply said that it will just be a waiting game to see who raises access fees first, the rest will follow but use the first as fuel to say their plan is better. They all operate pretty much the same, and its just fodder to brag that Verizon, AT&T, T-Mobile etc. are your carriers because they give you a better deal and works mostly as a side conversation at a dinner table... Its still too expensive on all they plans..
    19 May 2013, 07:49 PM Reply Like
  • These guys will not only wait for someone to bring rates up, but they as one post indicated they will focus on that till it plays itself out and do it to guide investors to another sector which is coming down the pike and that is Wireless "Broadcast Video"! This will put pressure on the likes of Comcast to try to buy into the Wireless Market in a big way! They would have to buy in or purchase its competition or be purchased by the Telecom WIEC! That would be an epic change into Cable/FIOS to Broadband Broadcast..

     

    Note: All the telecoms have a prepaid service and if that segment is growing, So is the bottom line for each of the providers. The amount each one grows will certainly depend on who has the best market share!!! Again very exciting times...
    19 May 2013, 07:49 PM Reply Like
  • I paid full pop for my iPad mini 4 g and get 2g of data for $30.00 no contract, if I could pay $650 for an iPhone 5s & get 2g data & a few hundred minutes & few hundred texts for $50 or $60 bucks a month I'd be all over that. Subsidized phones = hidden high interest rates for those of us with good credit and/or cash to pay up front.
    19 May 2013, 11:41 PM Reply Like
  • This is where a phone like the Nokia Lumia 521 shines. For only $130, you get a full featured WP8 smartphone with free Nokia streaming music, free Nokia maps, and corporate email/calendar Exchange sync and Office.

     

    T-Mo has the $30 100-min. unlimited data and texting plan which works well with this phone and saves a lot of money.
    20 May 2013, 03:10 AM Reply Like
  • AT&T Launches New Aio Wireless Prepaid Brand today 5/20/2013
    http://bit.ly/14p7r5p
    20 May 2013, 03:30 PM Reply Like
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