How flat-rate pricing changes the future of cellular

26.02.2008

However, the flat-rate plans will have a big impact on some users right away, according to Derek Kerton, principal of Kerton Group, a telecommunications consulting firm. He noted that $100 previously bought about 2,000 minutes per month, which is just about 33 hours.

"That's just over an hour a day," Kerton said. "Picture a sales guy on the road -- it was easy for that person to burn through an hour a day. For now, these flat-rate plans are for people like that."

Hart and Kerton agreed that flat-rate plans are likely to cost far less before long. Still, they said, cellular pricing will never reach the bargain-basement prices charged by today's long-distance suppliers. One reason: The old AT&T, which once had a near-monopoly on long-distance, suddenly faced strong competition from many new vendors, a situation that is unlikely to occur in the cellular industry.

"It won't be like long distance because the [cellular] operators have more control," Hart said. He predicted that flat-rate pricing schemes will never be priced more than $40 or $50 a month.

That, Kerton said, will make consumers happy, and not just because they'll potentially get more service for less money.

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