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New Prepaid Customers Outnumber Postpaid for First Time

Reports from Ovum/Datamonitor and IDG show that the number of new prepaid wireless customers in the U.S. was more than the number of new, contract-based cell phone agreements for the first time ever in the fourth quarter of 2009.

According to the most recent available quarterly data:

  • New prepaid cell phone subscribers accounted for nearly two thirds (65 percent) of the 4.2 million net subscribers added by U.S. phone carriers in the fourth quarter of 2009
  • The prepaid segment of the wireless market grew by 17 percent in the 4th quarter of 2009 to 54.4 million subscribers, up from 46.3 million in the same quarter in 2008. By contrast, contract-based cell phone service grew only 3 percent over the same period of time.
  • One out of five cell phone subscribers is now using prepaid phones. The prepaid segment represents a larger proportion of subscribers in the U.S. than ever before, hitting 20 percent in the 4th quarter of 2009, up from 18 percent at the end of 2008.
  • Overall, there were 285 million wireless subscribers in the U.S. at the end of 2009.

“We stand by what we forecast a year ago: The era of cell phone penny pinching is officially here,” said Jose Guzman, project coordinator, New Millennium Research Council. “Thanks to the recession, the U.S. cell phone marketplace continues to undergo fundamental changes that will just get bigger as the economic downturn deepens. What is different from a year ago is the explosion in new ‘all-you-can-eat’ and unlimited prepaid deals as low as $30 and $45 that will remain attractive to consumers long after the current recession is over.”


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