The telecom voice business was and always has been collecting nickels, dimes, and quarters. In other words it was and always has been about volume.

Back in 1991, I was very skeptical about the prepaid cell phone business. Yes, there were people thinking about even then. I had not originated the idea but I do recall the intense industry conversations. I blew off the idea because cellular service at that time was targeted towards business professionals and middle-to-high income people. Homemakers were considered cell users in only emergency events. Back then the whole idea of the average person with a cell phone was a goal but a distant reality.

However, the landline prepaid calling card was popular back then (early 1990s) but with the lower income customers or what we used to call the “anonymous user”. The stigma of prepaid service was intense then; so intense the whole idea of implementing pre-paid service to anyone other than a deadbeat was appalling. Bear in mind these were not the calling cards that were popular at the time. Landline calling cards were issued to landline telephone customers who needed a way to make calls that could be billed to the calling card customer’s billable telephone number. These calling cards were immensely popular with business people making calls from coin operated public telephones. Prepaid calling was something the “poor people” used. By the way that changed in the late 1990s when the landline telephone companies realized the so-called poor people had a lot of cash.

In the mid-1990s there was a huge industry push for something called prepaid in cellular. However, the clever marketing folks started calling it “rechargeable cellular service” and “pay as you go cellular service”. Well by that time folks, including me, saw enormous value in building a market that enabled us to go after people who did not have the best credit ratings or none at all; namely the new college graduates. Yes, college graduates made nice new cellular customers; they tend to take more risks with new technologies and spend money like it grows on trees.

It is now 2009 and pre-paid service has pretty much lost whatever stigma old timers like me had toward it. Unfortunately carriers still refer to prepaid as a service targeted towards “premium customers”. I think the term “premium customers’ is used for marketing purposes so that customers pay higher prices. Think “I am a premium customer” versus “you are not a premium customer”; its branding and packaging. At this time, data services are limited (or non-existent) in a prepaid service package; however, that will change over the next year or two.

The catch phrase today is “economical service”. Everyone during this recession wants to be a responsible and economical citizen. If I were Sprint, I would forget about creating customer level differences and begin aggressively offering prepaid cellular service to everyone. Sprint can still create a slew of different rate and service plans but proactively offer prepaid to your premium customers.

If I were Dan Hesse, I would change the game now.  MteroPCS, Leap,Verizon Wireless, and AT&T Mobility will be forced to change as well.  By the way this is all good for the consumer.