Pre-Paid, Basic Cell Phones On Decline

New York, NY (AHN) - Fewer pre-paid and basic cell phones are being sold in the U.S. as a widening adoption of post-paid cellular plans and high-end mobile phones reshape the market, studies said.

Both market analysts Strategy Analytics and NPD Group show a falling number of new U.S. cell phones being purchased. Strategy Analytics reports five percent less phones were purchased this quarter compared to the same period a year ago. NPD Group points to a 22 percent fall-off in quarterly sales.

Driving the changes is a double-barreled case of a slowing economy and a maturing U.S. wireless market. With more than eight in 10 Americans owning a cell phone, demand is dropping. Bernstein Research found a 23 percent drop in new U.S. cellular subscribers.

Pre-paid cell phones, once a thriving market is showing some slowdown as more families opt for plans that include their children, frequent customers of the pre-paid mobile phone.

Also, as carriers jockey to entice cell phone subscribers to their service, companies are offering more and more features, a segment that has grown to 17 percent from 10 percent in 2007.

Feeling the pinch is Motorola, which has seen much of its U.S. sales lost to Samsung or LG.