PREPAID INDUSTRY
The
prepaid industry is exploding! The growth is increasing at
unprecedented levels.
Consumers
are continually changing from postpaid contracts to prepaid
products since they have the ability to change to any carrier
without penalty and are
in pursuit of better rates and
more flexibility.
Mobile
phone penetration alone
is about 50 percent in the United States.
Because of U.S. carrier’s recent interest in promoting
prepaid service plans and extending
their market reach, U.S. wireless penetration is forecasted to grow to 70 percent in 2006. With the increase in prepaid competition,
prepaid airtime rates are decreasing faster than postpaid
rates. With rates continuing to fall,
mainstream consumers will increasingly adopt the prepaid mobile
option. Analysts
agree that prepaid wireless is the fastest growing segment
of the entire U.S. wireless industry. It is estimated that U.S.
prepaid mobile revenues will hit $40 billion in 2006.
| Who
uses prepaid services? |
|
| |
|
|
·
Mainstream
consumers
|
·
Contract
adverse
|
|
·
Teens &
youth
|
·
Credit challenged
|
|
·
Cash based
and ethnic groups
·
New market entrants
·
College
students
|
·
Budget conscious
·
Infrequent users
·
Business
travelers
|
|
Why are consumers using prepaid services? |
|
·
Technology
advances
·
Access to enhanced
communication channels
·
Ability to “try before you buy”
·
Mobility
and flexibility
|
·
Control
budgets and spending
·
No contracts
or commitment
·
Credit
challenged or no credit history
·
No banking
relationship to allow payment of traditional “post paid”
|
|
