Beginning June 22, cellphone provider Cricket Wireless will sell the iPhone 4 and iPhone 4S, making it the first no-contract wireless provider to do so. Cricket has offered partial subsidies on the phones -- about $150 off what Apple charges for "unlocked" handsets that you purchase directly from Apple, rather than from a carrier.
This is a breakthrough for prepaid service providers. While prepaid phone selections have gotten much better over the past year or so, Android smartphones haven't been enough to overcome the stigma of prepaid service. But the iPhone could do it.
You'll pay $300 more for an iPhone 4S at Cricket than with a contract at AT&T, Verizon and Sprint. But since Cricket's plan, at $55 a month, is less than half the cost of service from the others, you could wind up saving more than $1,200 over a two-year period, and that's including the extra you paid upfront for the phone.
While it's true that Cricket's no-obligation month-to-month plans don't lock you into a two-year contract like AT&T, Verizon or Sprint, you will have dropped up to $500 on an iPhone, and that may be tough to abandon if you're unhappy with your service or want another phone. The Cricket iPhone cannot be used on other networks. (Unlocked iPhones purchased directly from Apple can be used on either AT&T or T-Mobile, giving you some choice.)
Cricket is a regional carrier with decent service, according to Brad Akyuz, director of NPD Connected Intelligence. "Cricket operates on its own network in regional markets, but does provide a nationwide coverage via the roaming partnership with Sprint," he said.
Despite offering coverage around the U.S., many locations are not included. The company will release iPhones in about 60 U.S. cities. If you're in one of many major metropolitan areas -- San Francisco, Los Angeles, New York City or Chicago, for example -- you're out of luck, but people from smaller cities, including Fresno, Albuquerque and San Antonio, will have the opportunity to buy the first prepaid iPhone. To see whether Cricket iPhones will be available in your city, check www. mycricket.com/iphone.
Cricket's $5 monthly discount for additional phones on a single account -- referred to as family plans by other carriers -- will not apply to the iPhone, a Cricket spokesperson told me.
And while Cricket says the plan includes unlimited data, that's not really the case. For $55 a month, Cricket includes unlimited talk and text, along with 2.3GB of data. Once you reach that amount, Cricket will slow speeds. Rates are slowed, but not stopped -- a common practice with nearly all carriers these days.
The iPhones will be available at Cricket stores and online at mycricket.com. Other retail partners, such as Best Buy and Target, will not get the iPhone.
Cricket is not the only prepaid provider to cash in on the popularity of the iPhone. Virgin Mobile, owned by Sprint, is said to be getting the iPhone as early as July 1, but no further details on plans and rates are available. Like Cricket, Virgin begins throttling data at 2.5GB, which it calls unlimited. Sprint also owns Boost Mobile, another prepaid service, which may get the iPhone, but not until September.
To choose between prepaid carriers, compare plans and coverage. I expect Virgin and Boost to charge about the same monthly fee as Cricket. However, the Sprint-owned prepaid carriers offer far greater coverage than Cricket, about 278 million people compared to Cricket's 60 million.
Is there any reason not to buy your iPhone from a prepaid carrier? First, are you currently on contract with a carrier? You'll want to wait until the end of your contract to avoid an early termination fee. Second, check with friends or others who use either Cricket or Virgin (and perhaps Boost) to make sure you'll have the service and coverage you need. Do you always want the newest model? If so, Apple is due to release the iPhone 5 this fall and there's no word from the prepaid carriers on whether they'll be included. Best to wait and make your decision after the iPhone 5 launch.
If you aren't on contract, you've confirmed you'll get reliable service and you don't care about the upcoming iPhone, go for it -- prepaid carriers are no longer just for those who can't pass a credit check. They offer real value in today's market.
Ogden-based TopTenREVIEWS.com guides consumers by comparing products in the world of technology, including electronics, software and Web services. Have a question for TopTenREVIEWS? Email Leslie Meredith at email@example.com.