We have both; contracts and “pay as you go”. I didn’t realise that PAYG was uncommon for mobiles outside Europe.
Essentially. Basically, you buy a card with a certain amount of credit, say, £10. You phone your creditline and bang in the number on the card. You then have £10 worth of calling credit to use for calls, texts and so on; when it runs out, you can’t phone anyone (except 999 and the creditline). Alternately you could have a magnetic strip card you take to a shop that they can use to stick credit automatically onto your phone, but the idea is the same.
It depends. If you’re going to make a lot of calls, then a contract phone is usually better. Plus over here you’ll get deals where the phone handset itself is free, but you have to sign up to a certain length of contract. If you don’t use your phone all that much, and you’re ok with access to credit-selling shops, pay as you go might be better.
The U.S. has pay as you go too. They are in almost every convenience store I go to regularly. You buy the phone, buy the card and walk out 5 minutes later. I assume that it isn’t a great deal but there are probably some out there that are attractive to certain populations.
The charges per minute tend to be higher, but for people who don’t use the phone a lot, it works out cheaper. I don’t make many outgoing calls, mostly it’s texts and some incoming (remember the latter are free to recieve). I spend about £10-20/month, which is cheaper than any contract would be. And there’s myriad ways of buying credit - I do it either at an ATM or online.
It just depends how much you want to use the 'phone. For me, it makes more sense to have a cheap Pay As You Go 'phone, which I usually top up by giving it £10 or so when I am using a bank ATM. Otherwise, as others have said, buy a little card (available at LOTS of shops) or register your credit card details with the 'phone and pay by 'phone. And the money won’t run out at the end of the month or whatever, so if it is a month of not using the 'phone much, that’s fine, because I still have that money credited to my 'phone. Call charges per minute tend to be more expensive than with a contract, but it still works out financially more sensible for me, and I get the benefit of having the 'phone without being tied into any contract.
In the UK this may have been true but these days I suspect the majority are on 12 or 18 month contracts. PAYG (and the lack of charges for receiving calls) was a massive factor in getting people started using mobiles a few years back and the companies offered cut price handsets. The lack of credit checks and the impossibility of running up massive bills allowed lots of young people to get phones - 4 out of 5 adults have a mobile and as far as I can see every teenager does . Now we are all used to having mobiles the companies have reduced the subsidies on handsets for PAYG customers but not for contact customers.
The result is even young people are taking up contracts because they can get the latest, flash handset “free” every 12-18 months. Like Celyn I use PAYG as I don’t make lots of long calls (I only need to add £15 per month) but I am going to need a new phone soon (camera’s packed up and the joystick is sticking :dubious: ) and I will have the choice of paying £100 or more for a decent handset or taking out an 12 month contract at about £25 per month and getting a good hanset for nothing.
The biggest difference is that outside of America, you don’t pay to receive calls/texts. This makes it practical for certain demographics to have essentially a receive only phone. Teenagers and poor college students can put $5 on their phone every 6 months for emergency purposes and have everyone call them.
They had it here for a short period but it was so patently unfair that people be charged to receive calls (something over which they have little control) that it was canned almost immediately. Whether it was actually made illegal or all phone companies just acted out of self protection I don’t know. It amazes me this is considered OK in the US, in my experience Americans are very sensitive to having costs imposed on them.
It’s because mobile n umbers in Canada and the USA (not sure about other parts of the NANP) are mixed in with regular landline numbers, which are set up to pay to receive calls. There’s no special area code or anything for mobile numbers; each mobile number is associated with a locality, whose area code it shares.
It would have been far more complicated to program the system to pick out all the mobile numbers and charge the callers the receive airtime costs, than to just announce right at the beginning that you have to pay to receive as well as send.
In Canada, back in the days of the analogue cellphone, Bell tried to introduce caller-pay cellphone numbers with a special area code, 600, but that went over like a lead balloon. I had one and nobody wanted to call it. Plus, you couldn’t call area code 600 from outside Canada.
Actually, I can’t really imagine it’d be that hard to implement a “no payment for received calls/messages”. After all, they obviously already track if we’re using the airtime or not. How much more difficult could it be to say, “Well, he just received it so no cost there.” I think the real reason is that we’ve always had it that way and we don’t really realize how we’re getting shafted here. I certainly didn’t, until I went to Korea and didn’t get charged for anything incoming.
An issue that startled me last time I was in the US. Why can’t I find a phone that allows me to join any network I please?
I was looking for a replacement phone for use outside the US, Middle East, Europe, and Asia. Every phone I found was locked to a specific network. When I asked the man how to go about unlocking the thing he was really uneasy and acted like I’d just asked him where to buy drugs or something.
Where I’m at now, everyone just buys a phone and then gets a sim card for the desired network. If you don’t like that network then you join another.
I’m sure if the companies had realised twenty years ago just how much of a barrier the ‘receiver pays’ system would be to widespread usage in America, they’d have found a way to avoid it.
Edit: that’s not ignoring Sunspace’s early experience. Having it optionally would mark you out as cheap, ironically even though everybody else was being tight by not calling it. Plus, the charges for calling it were probably ridiculously high.
It’s a mixed bag. As other posters have noted, pre-paid cards (aka PAYG) are popular with younger people but I imagine when alot of these people get full-time jobs or a steady income they switch to bill pay as it represents overall better value for money.
Not exactly, different systems work better for different customers, younger people and others on low income will find pay as you go more reasonable because you cannot spend beyond your means on it. However per call and per text message you usually pay more with the prepaid systems than with bill pay. Prepaid systems are becoming more reasonable with some mobile phone companies offering extra credit for your money if you buy $20 worth instead of $10 and other offers like that.
Just for the record (not sure if it’s clear in the above thread) - nobody pays to receive a call on any type of phone/line in the UK (and I think Europe generally) - the exception being operator-connected reverse-charge calls (I think that’s called ‘collect’ in the US).
Of course we do pay, because it’s spread out into other charge components such as the cost of making calls and line rental, but nobody can inflict charges on a callee, just by phoning them.