racoma.com.phJ. Angelo Racoma on technology, economics, writing, problogging, and getting things done

When I was younger, I was a sucker for free-phone promos. GSM telcos are—to this day—fond of offering mobile phones for free or cheap in exchange for two-year contracts. And being in a serious relationship, I usually had the need to SMS and make calls often. And the expenses justified my signing up for postpaid plans. There were savings to be made, particularly compared to the pricing of prepaid. Postpaid offered cheaper minutes and more free SMS.

But later on I came to realize that I couldn’t afford to spend much anymore on mobile bills. I could not just easily cancel the subscription, as there were expensive termination fees if the lock-in period was not met. And perhaps to add insult to the injury, the value of the “free” phones were usually severely depreciated after just a few weeks’ time, as is the case with most gadgets.

And so I started ditching my postpaid plans in preference for prepaid as soon as I could. Some notable differences:

• I’m now married. And I work from home. So SMS and mobile call consumption has been minimized. While I used to spend PhP 3,000 plus on mobile bills before my wife (then-fiance) and I settled down we now usually share a PhP 300 or PhP 500 prepaid load every month (thanks to Globe’s share-a-load).

• I earn significantly more. So now I could afford to pay for a mobile phone in cash. This doesn’t mean, though, that I allow myself to splurge on every latest phone that comes up in the market. My wife’s previous phone lasted her five years, and when it gave out, we bought an elegant, reasonably-priced mid-range Nokia to replace it. My previous phone was the el-cheapo Nokia 1112, but when I realized I really needed Internet on the go, I got myself a Nokia E51. Both paid for in cash, which got us big discounts. Both bought at official retail outlets and not those dubious, fly-by-night stalls that sell fake stuff.

• It’s convenient. These days, being on prepaid is no longer as worrisome as before. You can buy prepaid load almost anywhere. And if you run out at an inconvenient time, you could always ask someone to “share” some credits with you. This is one of the reasons I prefer Globe over smart—their “Share a load” system is just better. You can transfer any amount up to PhP 150 at a time, and the expiry is usually longer, too. This is definitely better than Smart’s pre-defined PhP 10 transfer, which expires in a day.

• There’s no lock-in. Being on postpaid services won’t necessarily require a lock-in period. But those services that give you “free” stuff do. But with prepaid, you don’t have to pay for services you don’t consume. And you don’t get stuck with a service that might turn out to be crappy. And you have better control over consumption.

Of course, there are drawbacks, like not being able to recover your mobile number in case your mobile phone gets lost. And there are also services that are limited to postpaid, such as the unlimited Smart Bro plan (which I applied for, but am glad I ended up not being approved). For me, the benefits outweigh the costs.

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