Friday, October 31, 2008

Postpaid or prepaid ?



Around 90% of mobile subscriptions in Thailand are prepaid. This seems to be a norm for the mobile markets in this region of the world. People just don't want to sign a long-term contract so that they can freely switch to a better price plan/promotion whenever they want. Also, some users find it easier to control their usage in pay-as-you-use fashion. And, from user's point of view, prepaid seems to be more affordable compared to postpaid. From operator's point of view, prepaid eliminates problems of debts and unpaid users. Besides, the advancement of technology makes the investment cost per subscriber for prepaid account cheaper or equal to that of postpaid account.


One important factor is that there's virtually no handset subsidy in Thailand. Phones sold in Thailand are unlocked and can be used with any operator's SIM card. Usually, user buys a phone and SIM card separately. The prices for SIM cards are very cheap (virtually zero) due to high competition.
The introduction of Interconnection Charge (IC) makes the fees for the off-net calls higher than those of on-net calls. So, many users choose to carry more than one phone to take the advantage of cheap on-net call rate. One phone for each network. Further, some heavy users may have multiple SIM cards with different price plans/promotions from the same operator. One for day time and one for night time, for example. In some cases, switching of price plan/promotion means user need to change mobile operator, the SIM card, and therefore, the phone number. Having more than one phone number or changing phone number frequently seems to be an unavoidable behavior.
Mobile Number Portability (MNP) in Thailand has not yet implemented and was planned in 2009.

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