or You + 3 unlimited customers as a representative = FREE CELL PHONE SERVICE + EXTRA INCOME
What do you really know or pretend to know about cell phones? Hopefully this blog will shed some light on the different aspects of cell phones and cell phone plans.
Showing posts with label prepaid cell phones. Show all posts
Showing posts with label prepaid cell phones. Show all posts
Tuesday, November 9, 2010
How Do I Get Free Cell Phone Service?
or You + 3 unlimited customers as a representative = FREE CELL PHONE SERVICE + EXTRA INCOME
The Long Term Advantages of Prepaid Cell Phone Plans
No commitment means no subsidy
Since the nature of prepaid cellular service revolves around no contracts, it makes sense that companies do no subsidize the cell phones.. Much of the time, this means you're paying full retail price for a phone, which can now get up into the $300 and $400 range for the top models.
The companies' logic is that they don't want to give out a subsidy only to have you break away from their service in three months. Since there's no way to penalize a prepaid user -- since they never agreed to a contract -- there's no way to get back a monthly premium for an expensve cell phone.
The best offer in this regard comes from companies who sell discounted new cell phones or refurbished models. The cost of the unlimited talk, text and data from the postpaid plans is quite significant.
Take a close look at the numbers. Lightyear offers unlimited talk, text and data for $59.99 per month which equals $1119.88 for one year. Even with the cost of their most expensive Smartphone which is $414.99 the savings is still $245.01 for a year compared to ATT and $305.01 compared to Verizon. The difference with Sprint is not as significant $14.93 and Verizon's data service is limited to 2G.
But this is with the assumption that Lightyear's most expensive phone is purchased. Their phones range in price between $39.99 -$414.99. The savings can be extreemely significant.
There is more however...free service?
The Huge Draw of Postpaid Plans:The Price of Phones
Q:Free or cheaper phones, but what is the real cost?
A: A huge draw for postpaid cellular service is that most providers give away phones when you sign a new cell phone contract. There are certain models made available for these promotions, and they bring in the subscribers. Even if a new customer wants a different phone, a subsidy is applied to that purchase. That is, the service provider picks up some of the tab for your new phone. Thus the reason for credit checks.
Beyond the attractive marketing opportunities this presents, there's an overarching reason why carriers subsidize new cell phone purchases. Simply, in postpaid service, you're tied down to a contract, the norm being two years in length.
Q: So how, exactly, does this work?
A: Here's the idea behind subsidizing phones. For whatever reason, cell phones are rather expensive. This might be because of high mark-ups somewhere along the production line, or it might be that the phones actually cost that much to produce.
In any event, it's tough to get people to drop serious money on a cell phone. Not only do you have to pay for service on top of it, but they're especially fragile.
Think of your TV service. It's a similar situation in that you have to buy a TV, and then buy the cable service. However, TVs are less volatile than cell phones. They stay in one plays, rather than being trucked around in your pocket or purse. Because cell phones are mobile, they're far more apt to break. So this either means paying more for insurance, or paying for another phone down the road. Neither is very attractive -- especially considering how we've made cell phones an essential instrument in our daily lives.
Somewhere along the line, cell phone companies figured out that the best way to entice customers was to offer a discount on phones. But if they're taking a hit in that department, they have to make up for it somewhere else. Hence, the two-year contract.
Over the two-year term, the company figures to make back its investment in the subscriber's phone. This is also why they employ early termination fees. When you cancel before your contract is up, you're repaying the company for the subsidy they provided you.
But do you want to be locked into a plan just because the phone appears to be free or cheaper?
Is it really cheaper to be part of a postpaid plan, especially if the service is not the best? In the big picture postpaid plans are significantly more expensive and cell phones are a necessity in today's world.
What to do?
2 Types of Plans: Postpaid vs Prepaid Cell Phones
Most wireless service is sold on month-to-month or one-, two- or three-year contracts, with a monthly fixed cost that includes a set amount of useage or unlimited plans. Before signing a contract, you must go through the carrier's credit check. Every month you get a bill based on the cellphone plan you choose and any extras you used that month (e.g. minutes used above your plan, text messages, etc. etc. and so on).
If you decide to cancel service, it will cost you! Most providers have an early termination penalty. This can range from a flat fee to a charge per month remaining on your contract. This gives you a limited window of opportunity to cancel service without any penalty if you find out that a provider just doesn't meet your needs.
There is an alternative plan that allows you to change the number of minutes and other provisions: Prepaid Cell Phone Plan.
You won't be under contract and you don't have to pay a monthly package fee for having the service. You can buy the airtime as you need it (with some exceptions). And you do not have to pay a deposit for service.
Prepaid is also a way of learning about your usage patterns before committing to a long-term
Advantages of prepaid cell phones:
If you decide to cancel service, it will cost you! Most providers have an early termination penalty. This can range from a flat fee to a charge per month remaining on your contract. This gives you a limited window of opportunity to cancel service without any penalty if you find out that a provider just doesn't meet your needs.
There is an alternative plan that allows you to change the number of minutes and other provisions: Prepaid Cell Phone Plan.
You won't be under contract and you don't have to pay a monthly package fee for having the service. You can buy the airtime as you need it (with some exceptions). And you do not have to pay a deposit for service.
Prepaid is also a way of learning about your usage patterns before committing to a long-term
monthly billing wireless contract.
Advantages of prepaid cell phones:
- No contract to sign, no long-term commitment
- No monthly monthly bill to worry about.
- Better cost control. You know exactly how much you will spend.
- No hidden fees.
- No credit checks needed. Perfect for the credit challenged, since monthly billed plans require credit approval.
- Great if your usage varies from month to month.
- No security deposits. Some monthly plans may require a deposit.
- Topping up your account is easy and you can do it in many ways, at any time, by going on-line, by phone, bank machine or with a prepaid card.
Prepaid cell phones are ideal for:
- People who don't want to be locked into a year-long contract
- First-time cellular buyers who don't know how many monthly minutes they should sign up for.
- People who don't want to go over their budget
- People with damaged or no credit history
- Occasional users
- People who want to buy their children a phone for emergency use
- Travelers
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