Virgin Mobile and Cricket Wireless will be among the first U.S carriers to launch Apple's iPhone on a pre-paid service.
Virgin's pre-paid phone plan will let customers pay as little as $30 a month for an unlimited data package with a fair use policy. Full- speed data will be supplied for up to 2.5GB per month, after which the service will be slowed.
The $30 monthly plan also gives customers 300 anytime minutes and unlimited text messaging. For $40 monthly the user get 1,200 anytime minutes, and the $50 plan will provide customers with a fully unlimited service. But what's the catch?
The low-rate pre-paid plan will require customers to pay a higher unsubsidized price for the phone, starting at $549 for the iPhone 4 and $649 for the 4S.
This may seem like a lot to pay up front, but the pre-paid method saves customers up to $750 in comparison with the two-year contract plans offered by major networks, according to PC Magazine. The pitfall of the Virgin Mobile plan is that it doesn't run on a 4G network, making data browsing considerably slower than major U.S. 4G networks, such as Sprint, which owns Virgin Mobile.
Although $750 is a considerable amount to save, most American consumers are much more concerned with the up-front price of a phone, which is why unlocked and pre-paid services do not do as well in the market, PC Magazine reports.
Cricket Wireless will be the first mainland U.S. prepaid wireless carrier to sell Apple's iPhone, starting on June 22.
The San Diego company will offer the 16-GB iPhone 4S for $500 and the 8-GB iPhone 4 for $400. Each phone will be compatible with the Cricket Wireless data plan.
The iPhone 4 and 4S will come with an unlimited data package with a fair use policy for $55 per month. Full-speed data will be supplied for up to 2.3GB per month, after which the service will be slowed.
The phone will be available at Cricket Co.-owned stores as well as other select dealers throughout the country. The phones will also be sold on the company's website.
Cricket will likely subsidize each iPhone by about $100 to $125, J.P. Morgan analyst Philip Cusick, told Dow Jones.
Such expensive phones are nearly irrelevant to prepaid customers who aren't likely to shell out so much cash at one time. However, we do believe that the iPhone could benefit Cricket in terms of driving traffic to the store, with most customers choosing a more reasonably priced device instead. Given the launch is in the slow summer months, it could be a nice traffic driver in 3Q, Cusick said.
Virgin Mobile will launch its iPhone pre-paid service on June 29.