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U.S. mobile contract subscriber numbers shrink for the first time ever

News by Michael Oryl on Thursday May 10, 2012.

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As the Associated Press points out, there is a possible shift in the leanings of U.S. based mobile subscribers. T-Mobile's quarterly earning report from earlier today shows that the nation's number 4 carrier has had trouble holding onto contract customers, even though its net subscriber base was up due to wholesale and pre-paid additions.

These past few years of a softened economy have been good for the pre-paid carriers. Sprint's Boost Mobile and Virgin brands have been doing quite well, with their aggressively priced plans. MetroPCS and Cricket have also seen a few good quarters during that time, to be sure.

While it is true that Verizon, AT&T, and Sprint still saw contract customer growth in this past quarter, praise be to Jobs, the U.S. wireless industry as a whole reported contract customer loss for the first time. According to the AP, the top 7 U.S. carriers saw a net loss of 52,000 contract customers for Q1 of 2012. What about pre-paid customers? Those were up 2 million for the same period of time.

This isn't to say that the contract market is dead. Far from it. Contracts are still the best, or perhaps easiest, way for consumers to get mid- to high-end smartphones. Smartphone offerings on pre-paid plans are often meager, and Americans have yet to warm up to the higher up-front cost associated with pre-paid smartphones (even if they are cheaper in the long run). But the pre-paid market is strengthening, and the carriers and manufacturers will be forced to take it more seriously when it comes to devices if they are to keep their customers.

Google certainly seems to get it, with its crazily priced and unlocked Galaxy Nexus Android flagship smartphone, which is now available for only $399.

As a result, I expect that we are going to see more solid smartphones offered on pre-paid carriers, just as we saw with yesterday's launch of the HTC EVO Design 4G by Boost Mobile and the 3D-capable HTC EVO V 4G by Virgin Mobile, both available for $299.99 off contract.

If you are interested in taking a closer look at how you can save money on your monthly wireless bill while still maintaining the service level you need, you should check out Kevin C. Tofel's piece on Smart Talk at GigaOm. It's a very informative, and potentially money-saving, read.

via: The Associated Press

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About the author

Michael Oryl
Michael is the Philadelphia based owner and former editor-in-chief of MobileBurn.com. You can follow him on Twitter as @MichaelOryl

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