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Re: An Attempt at Economically Rational Pricing: Time Warner Trial

  • From: Patrick W. Gilmore
  • Date: Sun Jan 20 04:35:37 2008

On Jan 19, 2008, at 11:37 AM, Joe Greco wrote:
Mikael Abrahamsson writes:
Customers want control, that's why the prepaid mobile phone where you get
an "account" you have to prepay into, are so popular in some markets. It
also enables people who perhaps otherwise would not be eligable because of
bad credit, to get these kind of services.

However, if you look, all the prepaid plans that I've seen look suspiciously
like predatory pricing. The price per minute is substantially higher than
an equivalent minute on a conventional plan. Picking on AT&T, for a minute,
here, look at their monthly GoPhone prepaid plan, $39.99/300 anytime, vs
$39.99/450 minutes for the normal. If anything, the phone company is not
extending you any credit, and has actually collected your cash in advance,
so the prepaid minutes ought to be /cheaper/.

I disagree. Ever heard of volume discounts?

Picking on at&t again, a typical iPhone user signs up for 24 months @ ~ $100/month, _after_ a credit check to prove they are good for it or plunking down a hefty deposit.

Compare that $2.4 kilo-bux to the $40-one-time payment by a pre-paid user. Or, to be more far, how about $960 ($40/month for voice only) compared to $40 one-time?

Hell yes I expect more minutes per dollar on my long-term contract.


Hrmm, wonder if someone will offer pay-as-you-go broadband @ $XXX (or $0.XXX) per gigabyte?

--
TTFN,
patrick