PITTSBURGH -- No-contract cell phone plans are immensely popular overseas and are beginning to catch on in the Pittsburgh area.
Watch Aaron Saykin's ReportOnce regarded as an option for mostly low-income or infrequent cell phone users, prepaid plans are expanding. Some companies offer $50-a-month unlimited "everything" plans, while others sell basic service for as little as $10 a month.
"No contract is great because I've gotten into trouble with contracts before," Ilene Levy, of Pittsburgh, told Call 4 Action reporter Aaron Saykin.
Consumer Reports says they're at least worth a look for people who are trying to save money.
"I think they're useful in some ways," said David Farber, former chief technologist for the FCC. "Again, it depends on what you're doing."
According to the Wall Street Journal, people who use fewer than 200 or more than 600 minutes per month may benefit from switching to a prepaid plan. If the number of minutes is in-between, they may be better off with a traditional contract.
With prepaid plans, you have to pay full price for the phone.
"Since there's no commitment to the carrier -- there's no contract -- the carrier is not willing to give you a big discount, if any, so they tend to be the simplest phones, the cheapest phones," Farber said.
Another possible downside is a lack of coverage. Find out whose network is being used by a prepaid carrier and check that network's reception in your area. Also, check the fine print for extra fees.
It could also be a good idea to audit your monthly cell phone bill to see if you have the right plan for your usage. Some cell phone customers use so few of their minutes that they end up paying an average of $3 per minute to talk, Saykin said.
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