Prepaid Is No Bargain at Verizon

Leslie Meredith, Senior Writer TechNewsDaily

03 September 2010 05:05 PM ET

Verizon Wireless recently announced it will be expanding its portfolio of prepaid offerings to include a new 3G Prepaid data package that lets customers access unlimited data on select 3G smartphones and multimedia phones for a $30 monthly fee starting Sept. 28.

Verizon is the first major carrier to offer top-of-the-line smartphones under a prepaid plan. Verizon also announced a new $10 monthly data package for 25 megabytes of data, which is hardly enough for email , let alone music and video.

Prepaid means no two year contract, but it also means you'll pay full price for the phone upfront. And, like any Verizon data phone customer, you'll have to purchase a calling plan with or without texting on top of the data plan.

Included among Verizon's new prepaid phones are BlackBerry Tour, Droid X, Droid 2 and LG Ally. Verizon's monthly charges for prepaid plans and those with two year contracts are nearly equal. For 450 minutes, unlimited text and unlimited data, the monthly fee for prepaid service is $94.99 compared with $89.99 with a contract. At the end of two years, prepaid customers will wind up paying a premium of more than $400. Clearly, Verizon wants its customers locked into contracts.

Previously, only Sprint Nextel Corp.'s Boost Mobile and Virgin Mobile USA Inc., MetroPCS Inc., Leap Wireless International Inc., and T-Mobile USA offered prepaid plans. Many of these plans are still cheaper than Verizon's prepaid offerings.

For instance, Boost Mobile offers unlimited talk, text, web and email for BlackBerry for $60 a month. While customers are limited to the older BlackBerry Curve 8330 at $149.99, the total for two years comes to $1,589.99, a savings of $1,049.76 over Verizon's prepaid plan.