Walmart Entry Into Prepaid Cellphone Market… A Good Thing?

In: Breaking|Cellphone|Communication|Deals|Editorial|Save Money|Wireless

15 Oct 2009

Walmart entry into Prepaid Cellphone Market

Could the entry of Walmart into the arena of prepaid cellular wireless, a rapidly growing market sector in the US [ read more here ] be a real big game changer in terms of pricing, offers and signal an even bigger shift away from contract cellphone service?

The announcement Wednesday that Wal-Mart, the United States’ largest retailer, will offer a branded low-cost prepaid service, “Straight Talk,” at the $30 and $45 levels, could end up being the “tipping point for millions of consumers who are already considering moving away from expensive contract-based cell phone service,” according to New Millennium Research (NMRC) executive director Allen Hepner.

With average monthly contract plans reported to be about $81, the more than 140 million U.S. contract-based wireless customers who use less than 550 minutes a month may now have even more reason to consider switching to a less expensive cell phone option, particularly in a changing environment in which plans for 1,000 minutes are available through Wal-Mart for $30 per month, according to Hepner.

Highlights of the March 2009 and December 2008 NMRC surveys include the following:

  • Two out of five Americans with contract-based cell phones– are likely to cut back on their cell phones to save money if, as is widely expected, the economy gets worse over the next six months. (March 2009)
  • No fewer than 40 million Americans – 26 percent of consumers with contract-based cell phone service — are “more inclined today than … six months ago to look at a way to save money on your cell phone bill, such as by switching to a prepaid cell phone service.” (March 2009)
  • Of those Americans with cell phones, fewer than one in five (16 percent or nearly 29 million people) have a prepaid phone. Of the balance, 85 percent have “postpaid”/contract-based service where they pay a monthly fee. (The two percentages add up to more than 100 percent because of a small number of consumers who have both prepaid and postpaid cell phones.) (December 2008)
  • Only 44 percent of those age 18-24 years of age say they know when their contract-based wireless phone penalty ends. This percentage increases to 58 percent among those 25-34 and reaches its peak of 61 percent with those age 35-44. The percentage decreases somewhat to 55 percent for those aged 45-64 and declines sharply to 37 percent among those age 65 and over. (December 2008)

Apparently the NMRC (New Millennium Research) thinks that the Walmart prepaid cellphone market entry is the “tipping point” that could lead to a serious game changer.

This and T-Mobile’s upcoming “Project Dark/Black” could definitely mean better competition as far as pricing goes. And for the consumer… that’s a good thing. But then again, Walmart did enter into the electronic music store business and it didn’t quite slow down the Apple iTunes Music Store either.

[ NMRC ] [ Walmart ]

16 Responses to Walmart Entry Into Prepaid Cellphone Market… A Good Thing?

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Octogenaria

October 15th, 2009 at 9:16 pm

I’m one of those that was paying the $81 for 750 minutes, and guess what – swiched to the new Straightalk unlimited for $45 a month. A bargain in every sense. Now, why don’t mor suppliers offer this deal and make us pay dearly for our minutes? Contract suppliers are actually the worst for cell phone service. Prepaid providers seem to be much more in tune with the current economic conditions that just don’t seem to improve. At any rate, Straightalk’s unlimited plan – voice and text plus 30 mg of data are an incredible deal for $45!! Add to that no roaming or other fees on the Verizon, the most reliable network in the nation and what do you have? Only the best deal out there – and, of course, like all good deals, available at Walmart.

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William

October 15th, 2009 at 9:24 pm

I would love PAYG, however data is my biggest concern.

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[email protected]

October 15th, 2009 at 9:53 pm

Valuable thoughts and advices. I read your topic with great interest.

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Walmart Entry Into Prepaid Cellphone Market… A Good Thing?

October 16th, 2009 at 3:54 am

[...] is the original post: Walmart Entry Into Prepaid Cellphone Market… A Good Thing … Share and [...]

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Walmart Entry Into Prepaid Cellphone Market... A Good Thing?

October 16th, 2009 at 9:37 am

[...] This post was mentioned on Twitter by william mcbee and electronic_twit, Lloyd Palmer. Lloyd Palmer said: Walmart Entry Into Prepaid Cellphone Market… A Good Thing … http://tinyurl.com/yj26pjw [...]

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Tracy

October 20th, 2009 at 4:40 pm

@William, I use the Straight Talk unlimited plan. The data on that is now unlimited as well. I can’t wait to get my new qwerty Samsung! I already love the low-low price and the network quality.

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Dylan

October 27th, 2009 at 4:56 pm

Nice article. If we can score some serious savings through Wal-Mart plans, more power to us. But for those of us already on other plans and who want to save, however, I wanted to mention the next step–how to significantly lower your current rates. I actually work for the consumer advocacy website http://www.fixmycellbill.com (powered by a company called Validas) where we slash the average cell bill by 22 percent. Validas acts as the wireless bodyguard protecting you against frivolous charges that over-inflate 8 out of 10 cell bills. You can find out for free if fixmycellbill.com can modify your wireless plan to better suit your usage by going to the website.

For more info, check out Validas on Fox News at http://www.myfoxtampabay.com/dpp/consumer/conlaw/lower_cell_phone_bills_072409 .

Good luck to everyone reading on cutting your wireless costs, especially in this tough economy.

Dylan
Consumer Advocacy, fixmycellbill.com

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Corey Anders

October 31st, 2009 at 2:49 pm

The fix my cell billsite doesn’t include Straight Talk, so who needs it.

I discovered Straight Talk a few months back and love it.

The best thing about Straight Talk is its simplicity. I am so tired of wading through funky phone bills with mysterious charges and fees.

I really appreciate the savings, of course, but not having those awful and undecipherable bills has been a great stress-reducer.

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Pat Yoe

December 12th, 2009 at 9:47 pm

Great post!

I have Straight Talk, which is just an amazing deal.

I was skeptical at first but everything good I’d heard about it is true.

No more crappy coverage from AT+T. The Verizon network is solid and I haven’t dropped a call yet.

I think $45 a month is fantastic and I got a very nice Samsung phone with a qwerty keyboard so texting and web surfing is easy too.

I’m saving hundreds of dollars a year now so it’s pretty awesome.

I’m not the only one who thinks so, either.

Here’s another happy Straight Talk-er:
http://www.youtube.com/watch?v=oI40Fqglgys

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Who Cares a user

January 13th, 2010 at 1:48 pm

activation process stinks. I have been on the phone with TECH support several times in the last 24 hours because the phone will not activate. I’m told their is no phone numbers in my zip code. Straight Talk showes the phone in their system, but not processing the request to send out a phone number. I offered the idea of using a different zip code which has the same area code. Instead I have been transfered to the next level of tech support and now I have to wait for a call back which could take up to 24/48 hours. Thats a load of crap!! I have activated 3 Verizion Phones and a TREK PHONE all with in the last three months. Verizion phones and their service Excellent, TREK PHONE slow to activate but completed with in 2 hours. Straight Talk I’m just past the 24 hour mark and just got transfered to the next level of tech support and have to wait for a call back now ?? I WOULD NOT RECEMOND STRAIGHT TALK PHONES TO ANYONE! Their customer service people are polite enough, but their activation stinks

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Patrick

January 21st, 2010 at 2:45 pm

I activated my phone a month ago and activation took a grand total of 3 minutes. People who have had problems activating their phones are trying to port numbers. Just get a new number with your new phone and everything is done that quick and easy.

I love my phone. Easy to use, unlimited service, and it really is on the best network in the country. Everyone should switch to StraightTalk.

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Murry Katz

January 30th, 2010 at 1:06 pm

It’s awsome! I have Straight Talk on the Verizon network. Bought it at Walmart and it’s an amazing deal. The Samsung Finesse is a very cool smartphone and paying only $45 a month for unlimited everything is the best deal going!

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Kimberly

February 7th, 2010 at 10:34 pm

I was paying over $100 month with my previous carrier for pretty unreliable service and even more in overage fees – Straight Talk made great sense to me. The $45 unlimited use plan works out really well for me and is helping me save a little more than healf of what I used to pay – that means I will be saving $1,200 over the next two years. Straight Talk’s Verizon network really is the best out there in terms of calling area and reliability – I finally don’t drop calls. I was even able to keep my cell phone number across carriers so its even easier for me and my family to keep in touch. In terms of bargains, I have to admit that Walmart is really doing it right – Straight Talk is the best deal out there.

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yomero

March 24th, 2010 at 11:55 am

i was paying 99 dollars on sprint’s everything plan, plus insurance, long distance to mexico and text to mexico at 20 cents, was coming up sometimes with taxes and all that about 130 dollars a mont, when my contract wa over tol them i wanted to cut my service and they gave me that all web, text and calls to any mobile for 49.99, wich they were giving me a 20 dlls discount(of course another 2 year contract) and still was paying around 70 dlls, i was already cheking up STRAIGHTALK but had my douts about it so my friend tald me he wantedme to get him a line on sprint so i gave him my sprint phone(70dlls bill) and guess what i got me, STRAIGHTALK , got me the samsung finesse, a touch screen(wich it was 350 dlls), but considering all i paid with sprint and now paying 45dlls all aunlimited(48.75 with taxes) is a great deal for me, yes, the internet is a little slower, but i can see anything on the internet and somehow i can send and recieve text to mexico and i am not getting charged, so i am happy with my STRAIGHTALK service

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LydiaR

April 19th, 2010 at 6:28 pm

For Mother’s Day I am getting my Mom a net10 phone. She doesn’t use her phone too much and has been just totally taken advantage of with huge bills and she will never ever use the amount of minutes allotted to her. Getting her a prepaid Net10 is the best thing for her.. shes going to save soooo much money!!. It’s simple for her because theres nothing hidden to trick her with random fees and no contracts.

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dan

May 24th, 2010 at 2:41 pm

Prepaid is the way you should go. I bought a pay as you go Net10 phone for $30 and I pay only 10 cents a minute and 5 cents per text. Plus I don’t have to buy a certain amount of minutes for international calling which is 15 cents a minute. I just pay for what I use. I don’t see what could be better than that. I know what I am spending and I am saving an average of 50 dollars a month. We all know how much we need those savings.

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