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The history of the prepaid mobile phone began in the 1990s when mobile phone operators sought to expand their market reach. Up until this point, mobile phone services were exclusively offered on a postpaid basis (contract-based), which excluded individuals with poor credit ratings and minors under the age of 18 (the typical age of contractual capacity).
Prepaid mobile phones are used around the world.
A patent for prepaid mobile phones (Patent Number 5826185) [ citation needed ] HCTC was then an independent wireless carrier owned jointly by PacBell and BellSouth. HCTC introduced a service offering branded "calltrac" based on Voice Systems Technology, Inc.'s telephony platform with RPAC-2 billing during the first quarter of 1994.was filed on November 16, 1994. Among the first, if not the first large metropolitan area implementation of prepaid mobile phone service in the United States was in the early 1990s at Houston Cellular Telephone Company, Houston, TX.
HCTC initially offered prepaid mobile phone as a non-advertised alternative way to provide service to the more than 40% of cash-carrying, walk-in consumers who were being denied cellular service each day due to lack of credit. The plan was very expensive for the day, most subscription plans were double that of their postpaid subscribers and the prepaid subscriber still had to pay for their equipment (handsets) and anticipated call usage up front. HCTC used the Calltrack prepaid cellular program as a credit development vehicle until they developed subscriber reports intended to show that "Calltrack" was not a profitable venture.
The reports showed that a Calltrack prepaid subscriber was actually more profitable than their traditional postpaid subscribers by a huge margin. This was because, at that time it cost an average of 17% of their gross proceeds to collect on their bad debt postpaid subscribers, plus HCTC paid for all the postpaid handsets. HCTC was poised to become the first U.S carrier to go primarily prepaid, but it did not happen. Voice Systems Technology Inc. was sold to Boston Communications Group (BCGI) and the subsequent sale of prepaid cellular platforms in the US was immediately curtailed and the prepaid cellular service bureau was born. U.S Carriers spent several years trying to catch-up and develop their own solutions but patent litigation has kept prepaid from becoming the dominant form of payment.
The possibility of "prepaid wireless" in the United States actually came from Judge Green's decision to break up AT&T's monopoly. Prior to the 1968 Carterfone decision, AT&T prohibited connecting non-Bell (Western Electric or Bell Labs) ancillary devices to its telecommunications network.
A provider of prepaid mobile phone service was Banana Cellular, founded by Andrew Wise in 1993, which covered the provisioning of prepaid wireless services. Banana first sold prepaid mobile phone services in April 1993 in a small office located in Phoenix, Arizona.[ citation needed ]
The first practical implementation of prepaid wireless originated in the United States from a small group of entrepreneurs at Voice Systems Technology, Inc. This product was the core product under Houston Cellular's CallTrac (1994), Boatphone BVI's Prepay (1994), Cable & Wireless Prepay (1997), and BellSouth's first international prepaid wireless product (1996).[ citation needed ] The first European PAYG deployment was in Portugal in 1995 when Portuguese operator TMN deployed a PAYG solution called MIMO.
In November 1996, Vodacom (South Africa) became the first network to introduce prepaid mobile, under the 'Vodago' package, using an 'Intelligent Network' platform. This made it possible to debit customers' accounts in real time (MyBroadband (2014) 'Great South African inventions'), and led to a dramatic increase in uptake (Computer Business Review (2001) 'Mobile stats snapshot'). In 1998 Vodacom received a "Best GSM Service" award from the GSMA for this (GSMA (nd) 'Global Mobile Awards History').
The concept was further developed by Vodafone UK, who in Oct 1997 launched 'Pay as you Talk', packaging a GSM phone with a prepay tariff, and retailing it in new kinds of mass merchandiser retailers such as Woolworths and Argos and one year later into supermarkets such as Tesco (previously mobile phones had only been sold in specialist phone retailers). Customers could buy the product outright for £149 (reducing to £99 very shortly afterwards) which came with credit and then top up as they needed. Pay as you Talk went on to be the market leading prepay proposition in the UK for many years attracting millions of new mobile customers.
The concept was also developed by Eircell (then owned by incumbent Telecom Éireann) in the Republic of Ireland in 1997, as a method of letting different types of people (those under the age of 18, those without bank accounts and those without proof of identity) obtain a mobile phone. Originally limited to one TACS handset, costing £99 upfront, the system was an amazing success, despite the high price of calls and a 7p service charge on every operation. The system was branded as Ready To Go, a name still used by Vodafone, who now own Eircell.
The concept has since been copied in many other countries, with virtually every network in every European country supporting it. On many networks, such as Ireland's Meteor, pay-as-you-go is the main mode of operation, with pay monthly account phones being very much second-class. Conversely, in the United States, account phones offer the best features with pay as you go services being far more restricted in functionality. In developing countries pre-pay tariffs are chosen by the overwhelming majority of subscribers.
Early solutions to monitor the amount of credit remaining were called "hairpin solutions". They were so called because they connected the caller in and out of a central platform to monitor usage, meaning that it took two extra dedicated trunks on the cellular switch to make one call, one for the inbound connection to the telephony platform and the second back to the switch to complete the call. Trunks were an expensive resource in large metropolitan mobile telephone exchanges and switching equipment did not have the capacity that it has today, so prepaid was relegated to being the second choice for most US carriers.
Modern prepaid mobile phone solutions use out-of-band signaling called the Intelligent Network to monitor the credit without the need for hairpinning trunks. These are developed as international standards which allow prepaid use of a phone all over the world.
Advanced Mobile Phone System (AMPS) was an analog mobile phone system standard originally developed by Bell Labs and later modified in a cooperative effort between Bell Labs and Motorola. It was officially introduced in the Americas on October 13, 1983, Israel in 1986, Australia in 1987, Singapore in 1988, and Pakistan in 1990. It was the primary analog mobile phone system in North America through the 1980s and into the 2000s. As of February 18, 2008, carriers in the United States were no longer required to support AMPS and companies such as AT&T and Verizon Communications have discontinued this service permanently. AMPS was discontinued in Australia in September 2000, in Pakistan by October 2004, in Israel by January 2010, and Brazil by 2010.
A SIM lock, simlock, network lock, carrier lock or (master) subsidy lock is a technical restriction built into GSM and CDMA mobile phones by mobile phone manufacturers for use by service providers to restrict the use of these phones to specific countries and/or networks. This is in contrast to a phone that does not impose any SIM restrictions.
Celcom Axiata Berhad, DBA Celcom, is the oldest mobile telecommunications provider in Malaysia. Celcom is a member of the Axiata group of companies. Being one of the very few companies in Malaysia to originally obtain a cellular phone license, it successfully introduced mobile telephony in Malaysia through its ART-900 service, using first generation (analogue) ETACS specifications of the United Kingdom, a derivative of the US-AMPS technology. The ETACS ART-900 was started using the prefix "010". Celcom now uses the dialling prefix identifier of "013" and "019" and offer digital GSM, an originally European standard, now largely a world standard for mobile communications. The original frequency band for GSM is 900 MHz, and was soon extended to 1800 MHz to cater for a much wider bandwidth requirements. The 2100 MHz band is used for their dual-channel HSPA+ network. Celcom is also licensed and has been operating FDD-LTE on 1800 MHz and 2600 MHz.
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A prepaid mobile device is a mobile device such as a phone for which credit is purchased in advance of service use. The purchased credit is used to pay for telecommunications services at the point the service is accessed or consumed. If there is no credit, then access is denied by the cellular network/Intelligent Network. Users can top up their credit at any time using a variety of payment mechanisms.
The history of mobile phones covers mobile communication devices that connect wirelessly to the public switched telephone network.
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The postpaid mobile phone is a mobile phone for which service is provided by a prior arrangement with a mobile network operator. The user in this situation is billed after the fact according to their use of mobile services at the end of each month. Typically, the customer's contract specifies a limit or "allowance" of minutes, text messages etc., and the customer will be billed at a flat rate for any usage equal to or less than that allowance. Any usage above that limit incurs extra charges. Theoretically, a user in this situation has no limit on use of mobile services and, as a consequence, unlimited credit. This service is better for people with a secured income.
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Arlene Joy Harris is an entrepreneur, inventor, investor, and policy advocate in the telecommunications industry. She is the president and co-founder of Dyna LLC, an incubator for start-up and early-stage organizations historically in the wireless technology field. Ms. Harris is widely recognized as a pioneer in mobile and wireless enterprise and an innovator of consumer products and services. In May 2007, she became the first female inductee of the Wireless Hall of Fame, and was named to the Consumer Technology Hall of Fame in 2017.
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