SOURCE: Century Capital Research

June 15, 2012 08:00 ET

No-Contract Phone Market Gains Steam

NOTE TO EDITORS: The Following Is a Research Alert Issued by Century Capital Research

NEW YORK, NY--(Marketwire - Jun 15, 2012) - A USA Today article on the emerging pre-paid phone market highlights that Verizon Wireless (VZ), AT&T (T) and other major wireless carriers are focusing on a class of customers they once largely ignored: bargain hunters with a fear of commitment. Major carriers "are focusing on pre-paid as a growth engine," says analyst John Weber of IDC. The research firm estimates the pre-paid market will grow 7.4% a year on average until 2016.

Along with pre-paid cell phones, pre-paid landline carriers are making headlines with offering no contract phone service to homes and businesses. Providers of local telephone services like Everybody's Phone Company (PINKSHEETS: EVPH) and Telstra (Australia) offer any individual who has been denied access by their local providers, or to those individuals who do not wish to purchase services from their regional operating company. The service is provided on a pre-paid basis before monthly service begins, therefore eliminating deposit requirements, credit checks, ID, or social security questions. As landline subscribers continue to fall nationwide, pre-paid options could rise as a viable option in households and businesses that rely more on mobile phones as a primary way of making calls.

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