October 01, 2012, 2:58 PM — In an era when wireless data and phone service can cost a U.S. contract customer more than $1,200 annually, some lower-cost pre-paid options are emerging.
AT&T Minday unveiled the GoPhone plan, which offers unlimited talk and text with 1GB of data for $65 a month. The plan takes effect Oct. 7.
The new GoPhone plan is $10 less that a previous similar AT&T plan.
It also undercuts a similar Verizon Wireless prepaid plan introduced in May that costs $80 a month.
Also on Monday, start-up FreedomPop, which is funded in part by Skype co-founder Niklas Zennstrom, launched a beta version of a service that offers half a gigabyte of high-speed wireless data per month for free, 1GB for $10 a month and 5GB for $35 a month. (To compare, a Share Everything contract plan, post-paid on Verizon offers 6 GB for $80 a month plus a $40 smartphone connection fee. The Verizon plan also comes with unlimited calls and texts.)
Like many new concepts, there are conditions to the FreedomPop plan.
Since FreedomPop relies on cellular service from Clearwire, it is not nationwide. Also, users must pay $99 for a sleeve to wrap around an iPhone or iPod Touch. The sleeve holds a link to the cellular network. The FreedomPop service uses Wi-Fi to communicate with the phone. A portable Wi-Fi hot spot is another communications alternative.
FreedomPop is data only. Users might need a separate service for phone calls or texting, or could use an Internet-based calling service from companies like Skype.
The question for many users on pre-paid plans such as GoPhone is whether the largest carriers with the largest networks, including AT&T and Verizon, will make popular powerful, multi-featured smartphones eligible.
Both AT&T and Verizon have recently expanded the numbers of prepaid phones they offer.
There are tales of users, including one profiled by Computerworld blogger JR Raphael, who buy unsubsidized high-end phones (some in the $450 to $600 range) and then use plans like the $30 a month T-Mobile USA product that offers 100 minutes of voice, unlimited texting and 5GB of data over the carrier's HSPA+ network.
For 3G GSM phones on AT&T or T-Mobile, users can also purchase a StraightTalk SIM card and airtime bundle for $45 a month, getting unlimited data, talk and text. The user needs a phone compatible with the two networks or an unlocked GSM phone.