Sprint's Boost Mobile the preferred carrier in growing prepaid market

Whether Americans are pinching pennies or wanting to avoid the bridle of a two-year contract, customers are signing up for prepaid, no-contract wireless subscriptions more than ever before, the New Millennium Research Council (NMRC) think tank announced yesterday. By the end of 2011, such plans will be the choice of one in four new subscribers.

The trend is notable for occurring as AT&T, Verizon and T-Mobile have abandoned unlimited data plans, clearing the way to either charge their high data users or else slow their service — particularly as it seems that unlimited plans are what people want. (CP: Carriers should tread cautiously with family data plans.) From the fourth quarter of 2009 to 2010, traditional prepaid subscriptions "lost ground," reports the firm, while unlimited prepaid plans posted "strong gains, with 7.4 million new subscribers, up 45% over that one-year period."

Based on current growth trends, the non-wholesale wireless market in the U.S. is expected to reach 290 million subscribers by year's end. Prepaid is driving a good chunk of that growth.

"For the first time, non-contract prepaid subscriptions will account for roughly 25% of the total wireless picture," the firm reported.

Which prepaid provider is the best?

The NMRC report coincided with the release of J.D. Power and Associates' 2011 Wireless Customer Care Performance Study, which found Sprint's Boost Mobile to have received the highest overall customer care satisfaction score — 763 — among contract-free service providers.

"This overall score is comparable to the high-performing full-service provider scores," reported J.D. Power. "The company performs particularly well in phone contacts that originate in the [automatic route selection (ARS)] channel and are then transferred to a live service representative, and through phone calls made directly to a [customer service representative]."

While among traditional carriers the accolades went to Verizon, which scored a 770, compared to second-ranking T-Mobile's 766, third-ranking Sprint's 752 and fourth-place AT&T's 751, Boost's win was far more distinctive, as it came in 57 points ahead of its closest-ranking competitor, Tracfone. (From there the competition followed more closely, with MetroPCS earning a 703 and Cricket a 699.)

J.D. Power found a major indicator loyalty to be how well-cared-for a customer feels.

"Wireless customers who indicate that they have had a positive care experience are more loyal and are, therefore, less likely to switch carriers in the future, on average," the firm reported.

While early cancellation fees are a considerable disincentive, contract-based customers may nonetheless be inclined to stay put.

"Overall customer satisfaction is much higher among wireless contract-based customers," stated J.D Power, "than those who subscribe to prepaid or non-contract service plans."