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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).
A mobile phone operator, wireless provider, or carrier is a mobile telecommunications company that provides wireless Internet GSM services for mobile device users. The operator gives a SIM card to the customer who inserts it into the mobile device to gain access to the service.
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.
A credit rating is an evaluation of the credit risk of a prospective debtor, predicting their ability to pay back the debt, and an implicit forecast of the likelihood of the debtor defaulting. The credit rating represents an evaluation of a credit rating agency of the qualitative and quantitative information for the prospective debtor, including information provided by the prospective debtor and other non-public information obtained by the credit rating agency's analysts.
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.
BellSouth, LLC is an American telecommunications holding company based in Atlanta, Georgia. BellSouth was one of the seven original Regional Bell Operating Companies after the U.S. Department of Justice forced the American Telephone & Telegraph Company to divest itself of its regional telephone companies on January 1, 1984.
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.
Boston Communications Group, Inc., more commonly called bcgi, was one of the largest prepaid mobile phone companies in the United States until 2007. In 2005, they settled a patent lawsuit brought by Freedom Wireless, a private intellectual property firm based in Phoenix, Arizona. bcgi and its co-defendant had lost a jury trial, which awarded Freedom $128 million in damages. The co-defendants agreed to collectively pay $87 million, of which bcgi's share was $55 million. The stock price jumped from $2.09 to $4.01 upon news of the settlement, because the lawsuit threatened to drive the company into bankruptcy.
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.
Western Electric Company was an American electrical engineering and manufacturing company that served as the primary supplier to AT&T from 1881 to 1996, and to the local Bell Operating Companies until 1984. The company was responsible for many technological innovations and seminal developments in industrial management. It also served as the purchasing agent for the member companies of the Bell System.
Nokia Bell Labs is an industrial research and scientific development company owned by Finnish company Nokia. Its headquarters are located in Murray Hill, New Jersey. Other laboratories are located around the world. Bell Labs has its origins in the complex past of the Bell System.
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 ]
Phoenix is the capital and most populous city in Arizona, with 1,660,272 people. It is also the fifth most populous city in the United States, and the only state capital with a population of more than one million residents.
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.
Portugal, officially the Portuguese Republic, is a country located mostly on the Iberian Peninsula in southwestern Europe. It is the westernmost sovereign state of mainland Europe, being bordered to the west and south by the Atlantic Ocean and to the north and east by Spain. Its territory also includes the Atlantic archipelagos of the Azores and Madeira, both autonomous regions with their own regional governments.
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 developed by Bell Labs, and 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.
Rogers Wireless Inc. is a Canadian wireless telephone company headquartered in Toronto, providing service nationally throughout Canada. It is Canada’s largest wireless carrier, with 10.8 million subscribers as of Q4 2018, and revenues of just under $15.1 billion in 2018. It is a wholly owned subsidiary of Rogers Communications.
Fido Solutions Inc. is a Canadian cellular telephone service provider owned by Rogers Communications. Although Fido's parent company, Rogers Communications, also operates another cellular service Rogers Wireless, Fido remains a separate entity and retains its own retail chain, customer service call centres, network servers and CEO. Fido pioneered the concept of providing unlimited service in select Canadian cities. Fido was the first carrier in Canada to launch a GSM-based network and the first wireless service provider in North America to offer General Packet Radio Service (GPRS) on its network.
Mobile telephony is the provision of telephone services to phones which may move around freely rather than stay fixed in one location. Telephony is supposed to specifically point to a voice-only service or connection, though sometimes the line may blur.
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.
TracFone Wireless, Inc. (TFWI) is an American prepaid, no-contract mobile phone provider. TFWI is a subsidiary of Mexico's largest telecommunications company, América Móvil, and offers products and services under several brands. It operates as a mobile virtual network operator (MVNO), holding agreements with the United States' largest wireless network operators to provide service, including Verizon Wireless, AT&T Mobility, T-Mobile US, Sprint Corporation, andTracFone Wireless had 25.668 million subscribers in 2015.
Digi Telecommunications or Digi.Com Berhad, is a mobile service provider in Malaysia. Its largest shareholder is Telenor ASA of Norway with 49%. On 24 May 1995 Digi became the first telco in Malaysia to launch and operate a fully digital cellular network.
TELUS Mobility is a division of Telus which sells wireless services in Canada on its numerous networks. It operates networks using HSPA+, and LTE on its mainstream networks. As of Q2 2019, Telus Mobility is Canada's third-largest cellphone provider with a subscriber base of 9.9 million .
Telcel is a Mexican wireless telecommunications company, owned by América Móvil. Founded in 1989 and based in Mexico City, Telcel is the leading provider of wireless communications services in Mexico. As of December 31, 2006, Telcel's cellular network covered more than 63% of the geographical area of Mexico, including all major cities, and 90% of Mexico's population. Telcel holds concessions to operate a wireless network in all nine geographic regions in Mexico using both the 850 megahertz and 1900 megahertz radio spectrum. According to Cofetel, as of July 2008, Telcel's subscribers represented an estimated 77.2% share of the Mexican wireless market. In August 2011, Telcel reported it has 66.9 million cellular subscribers.
Solo Mobile is a discontinued mobile virtual network operator in Canada started by Bell Mobility in 2000. Historically, Solo was considered a discount wireless brand, offering low price monthly plans with some unlimited options in certain cities. Its products and services were only sold in British Columbia, Alberta, Ontario and Quebec. The brand ceased advertising towards new customers since November 2011, and new activations were officially discontinued on May 17, 2012.
Generic Access Network (GAN) is a protocol that extends mobile voice, data and multimedia applications over IP networks. Unlicensed Mobile Access (UMA) is the commercial name used by mobile carriers for external IP access into their core networks. The latest generation system is named Wi-Fi Calling or VoWiFi by a number of handset manufacturers, including Apple and Samsung, a move that is being mirrored by carriers like T-Mobile US and Vodafone. The service is dependant on IMS, IPsec and ePDG.
Citycell was the oldest mobile operator of Bangladesh. It was the only mobile operator in the country using CDMA and EVDO technology. As of August 2016, Citycell's total mobile subscriber base was 0.142 million. Citycell is currently owned by SingTel (44.54%), Pacific Motors (37.95%) and Far East Telecom (17.51%). It is the smallest mobile operator of Bangladesh in terms of subscribers. It was shut down due to failure of paying dues as ordered by the High Court by the Bangladesh Telecommunication Regulatory Commission (BTRC) in 2016.
Phone cloning is the copying of identity from one cellular device to another.
Koodo Mobile is a Canadian mobile flanker brand started by Telus in 2008 and mostly oriented toward younger customers. Koodo differs from its parent Telus by not requiring a fixed term contract. Koodo currently provides postpaid, prepaid, and wireless home phone services. Being a subsidiary of Telus, Koodo has been able to offer extensive coverage and a strong presence in mobile retailers. This allowed Koodo to gain a presence nationwide.
Entel Phone is a Chilean mobile phone operator, a subsidiary of the Entel Chile Group. Currently, it is the second largest cellular phone provider in Chile with 6 million subscribers, behind Movistar Chile with 6.2 million customers. This makes Entel the largest operator with annual growth of the country (15%).
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. She was the first woman inducted into the Wireless Hall of Fame in May 2007 and was named to the Consumer Technology Hall of Fame in 2017.
PC Mobile is a licensed white label prepaid wireless service operated in Canada. Its mobile telephone products and services operate on the network infrastructure operated by Bell Mobility and formerly Telus Mobility, but licensed the proprietary branding and payment media with the President's Choice supermarket store brand owned by Loblaws Inc.
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