3 ms·

This makes me practically foam at the mouth. "Pre-paid" that expires a month or two after you purchase it, isn't. It is merely paying month-to-month. Pre-pai

This makes me practically foam at the mouth. "Pre-paid" that expires a month or two after you purchase it, isn't. It is merely paying month-to-month. Pre-paid should not expire for a reasonable time-frame (at least a year, if ever), regardless of how much you've purchased -- just like international calling cards.

Dylan16807 14y ago
It depends on how the expiration works. I think tracfone's policy is fair. As long as you don't run out of service days your minutes will never expire, and you can get three months of them for $20.
- Wingman4l7 14y ago
  I was going to mention TracFone as a good example, actually -- but I looked at their website and saw that they had the "service days" limitation that you mention. IIRC they used to have an even better policy than that, more in line with what I described.
  - Dylan16807 14y ago
    Really? All I know about TracFone policy changes is that service days used to expire so you were forced to buy a card every 3 months instead of stocking up. But they changed that. Either way it doesn't make sense to charge $0 for a phone to consume resources by having a constant connection to cell phone towers and reserving a number. $7 is pretty cheap so I hope it's a fair price compared to actual costs.
icebraining 14y ago
Here in Portugal they're like that nowadays; I think you still have to make a phone call every month or so, but I imagine that's to cut down on abandoned phones. That said, I can't imagine the carriers being too happy about having clients like me, who only charge the phone with $10 every three months ;)
mfringel 14y ago
So, here's why that happens. There are typically two phone-minute charging models: "Calling party pays" (Eurozone, others) and "Both sides pay" (US, Australia(?)). In a "both sides pay" scenario, each customer pays for their own side of a call. I call your mobile from my mobile, we're each charged a minute per minute. In a "calling party pays" scenario, the person who calls pays for both sides of the call. You can tell when this is happening by whether there are different rates for calling landlines vs. mobile phones. The important thing here is what this means for pre-paid services. In a "calling party pays" situation, a mobile subscriber can continue to make money for the telco _just by leaving their phone turned on_, regardless of whether they can make outbound calls. The inbound caller will still be giving money to the pre-paid caller's telco. With "both sides pay", the telco of the pre-paid customer receives all revenue up-front; there's no subsequent money to be made because all charges come out of the credit balance of the pre-paid customer. Between that, and revenue recognition rules, it makes sense to expire that credit every 1-2 months because there's no other way to get a revenue stream off that customer.

Dylan16807 14y ago

It depends on how the expiration works. I think tracfone's policy is fair. As long as you don't run out of service days your minutes will never expire, and you can get three months of them for $20.

Wingman4l7 14y ago
I was going to mention TracFone as a good example, actually -- but I looked at their website and saw that they had the "service days" limitation that you mention. IIRC they used to have an even better policy than that, more in line with what I described.
- Dylan16807 14y ago
  Really? All I know about TracFone policy changes is that service days used to expire so you were forced to buy a card every 3 months instead of stocking up. But they changed that. Either way it doesn't make sense to charge $0 for a phone to consume resources by having a constant connection to cell phone towers and reserving a number. $7 is pretty cheap so I hope it's a fair price compared to actual costs.

icebraining 14y ago

Here in Portugal they're like that nowadays; I think you still have to make a phone call every month or so, but I imagine that's to cut down on abandoned phones. That said, I can't imagine the carriers being too happy about having clients like me, who only charge the phone with $10 every three months ;)

mfringel 14y ago

So, here's why that happens. There are typically two phone-minute charging models: "Calling party pays" (Eurozone, others) and "Both sides pay" (US, Australia(?)). In a "both sides pay" scenario, each customer pays for their own side of a call. I call your mobile from my mobile, we're each charged a minute per minute. In a "calling party pays" scenario, the person who calls pays for both sides of the call. You can tell when this is happening by whether there are different rates for calling landlines vs. mobile phones. The important thing here is what this means for pre-paid services. In a "calling party pays" situation, a mobile subscriber can continue to make money for the telco _just by leaving their phone turned on_, regardless of whether they can make outbound calls. The inbound caller will still be giving money to the pre-paid caller's telco. With "both sides pay", the telco of the pre-paid customer receives all revenue up-front; there's no subsequent money to be made because all charges come out of the credit balance of the pre-paid customer. Between that, and revenue recognition rules, it makes sense to expire that credit every 1-2 months because there's no other way to get a revenue stream off that customer.