The Cellphone Industry is Booming

The mobile market has changed considerably over the past 15 years. What was once a simple device that was designed to take and make phone calls has almost replaced the desktop computer completely in 2015. Google has even reported that there are more searches on mobile than there are on desktops. Smartphones, which used to be considered a luxury, are now the standard thanks to companies like Verizon, AT&T and Tmobile subsidizing the $800 cost of the iPhone or Android smart phone. The low cost carriers who offer post-paid accounts such as Boost Mobile, Straight Talk and Cricket Wireless are also offering high end smart phones (which have been manufactured in most cases). The big cell phone carriers are also getting into the multi-billion dollars post-paid cell market as well. They offer their own low cost phones and pay-as-you-go plans.

When it comes to mobile, a huge issue that the consumers are facing is data. Being that the majority of cell phone usage is via internet, or playing games or shopping, the data plans are where the big money is made. Recently AT&T was fined over $100,000,000 by the FTC for misleading their customers about the so called “unlimited” data plans that they offer. This is unfair to low income consumers who are only given 1 gigabyte of data each month. A $40 per month cell phone plan can easily balloon to hundreds of dollars per month in data charges if the customer is not keeping track of his/her data usage.

Recently there has been an attempt to capitalize on the post paid cell phone market. Freedompop, a pay-as-you go cell phone carrier that piggybacks on the Sprint network has started offering free cell phone service (with compatible phones). Users are given 1 gigabyte of data per month, which is enough if you don’t play games or watch videos or other high bandwidth intensive activities. Users can increase their monthly bandwidth allotment by paying $20 more for 4 gigabytes of data.

The bigger cell phone companies are trying to compete against newcomers such as Freedompop and Textnow. Even Google is currently trying to break into the post-paid cell phone industry with their Project Fi, which alternates from the AT&T network to the Sprint network, whichever has the stronger signal. The issue with most of these companies is that they are utilizing older cell phone networks that aren’t as robust or strong as Verizon’s 4g LTE service.

The current trend in cell phone companies is to offer discounts, coupon codes and other incentives to get customers to switch their networks. Such companies as Straight Talk are offering promo codes which lower the monthly cost (and in some cases provide increased bandwidth). These coupon codes are in high demand and change regularly. They also offer refurbished phones which allows the consumer to purchase a brand new iPhone 6 (that has been refurbished) for pennies on the dollar.

We recently spoke with cell phone insider Sam Goldstein and he told us that big changes are on the horizon if the FCC makes a new ruling regarding the so called throttling of data plans. The smaller companies, coupled with their aggressive usage of promotional codes for their users could shake up the industry and cause a more level playing field (as well as lower the cost of the average plan due to increased competition). Sam says that we won’t know for sure until the FCC is finished with their investigation into the cell phone industry and throttling practices.

There could be big changes on the horizon for the big cell phone carriers. Stay tuned as we will stay on top of this news story. Here is the source for our Straight Talk Wireless references and article.