A very common question when choosing an Iridium airtime plan is, “Should I go with prepaid or postpaid?”
The general answer to this question is actually with another question, “Do you plan on using the phone?” In most cases, the answer to this question will put you into one of two categories: 1. Emergency-Only User, or 2. Active User.
Some people purchase an Iridium phone to use strictly for emergencies, so they plan on rarely using airtime, if ever. They simply need the phone to be active and available for that critical situation. In this case, it usually makes the most sense to go with a postpaid plan. There is really only one postpaid plan, which is the Basic plan. It is $49.95 per month for the subscription, which keeps the phone active, and any minutes you end up using are billed at $1.39 per minute. If you don’t use the phone, you are only liable for the monthly subscription fee. The main advantage with this plan is that you have a minimal monthly expense that you can budget and still know your phone will be available for when you need it. The other advantage is that it is an open account so, when you do use the phone, you would be able to use as many minutes as you needed.
The other group of subscribers are those that are actively using their phone, whether it be year-round or seasonally. Typically, a prepaid plan is more cost effective in the long run if you are using airtime, because there isn’t a subscription fee like the postpaid plan so you are only paying for straight airtime. The detail to be aware of with any prepaid plan is the expiry period. Every prepaid bundle has a different time allotment and the bigger the bundle is, the more time you have to use it.
The best point of comparison between postpaid and prepaid is when you stack the Basic postpaid plan against the 500 minute prepaid plan. The 500 minute prepaid plan is valid for 12 months and the price for a new activation is $745. This is an effective rate of $1.49 per minute. If you take the Basic postpaid plan’s monthly fee of $49.95 and multiply it by 12 months, this works out to $599.40–about $145 less than the 500 minute plan. If you take $145 and divide it by the $1.39 per minute rate of the Basic postpaid plan, this works out to be about 104 minutes, which is your break-even point. So, if you think you will use around 100 minutes or more in 12 months, you’re getting a better value from the 500 minute prepaid plan, since you are effectively getting an additional 400 minutes for the same cost. The one trade-off to this is that you are paying for all of those minutes up front. If you are concerned that you might not use all 500 minutes within the 12 months, don’t worry, as long as your refill your plan (with any amount of minutes) before your expiration date, those remaining minutes would roll over.
If you are a seasonal user, you can do a similar analysis with the 200 minute prepaid plan, which is valid for six months. The price for a 200 minute prepaid bundle is $500 and six months of the Basic postpaid plan plus 200 minutes would be $577.70. In this case, there would be a net savings of $77.70 with the prepaid plan. The 150 and 75 minute prepaid plans are basically a wash when compared to the Basic postpaid plan.
In conclusion, you’ll see the most dramatic savings when comparing the 500 minute or higher prepaid plan with the Basic postpaid plan. Coincidentally, the 500 minute prepaid plan is the most popular amongst our subscribers.
There is always a third option, right?
Iridium also offers Regional prepaid plans. Before I get to these, I will point out that even though I stated earlier that there is just one postpaid plan available, there is actually an additional one–the Australia/New Zealand regional postpaid plan. This plan makes the most sense if you are only planning on using your phone in Australia or New Zealand. The subscription is only $34 per month and airtime is just $0.80 per minute. The roaming rates outside of these countries are extremely high with this plan, so even though you can roam with it, we really don’t recommend it.
Getting back to the regional prepaid plans, there are four to choose from: Africa, MENA, Northern Lights, and South America.
The Africa plan is pretty straight forward—it includes roaming in all of the countries in Africa. It costs $320 for 300 minutes and the minutes are valid for 12 months. So, if you are only planning on using your phone within the continent of Africa, this plan offers very good value.
The MENA plan is very similar to the Africa plan, only along with the African countries, it includes most of the countries in the Middle East region as well. This plan costs $460 for 500 minutes which are also valid for 12 months.
If you can’t tell by the name, the Northern Lights plan is a regional plan for only Alaska and Canada. This is a very popular plan for those only using their phone in Alaska or Canada since it offers great value. You get 200 minutes for $199 and they are valid for six months.
The South America plan is for use within all of the South American countries. You get 100 minutes for $199 and they are valid for six months.
Two Trains Depart the Same Station Travelling at Different Speeds…..
Does all of this sound like a high school math story problem? Don’t worry, it probably seems more complicated than it really is. You are always welcome to speak to us about your particular needs so we can help you figure out what plan makes the most sense. The important part is simply to define the main purpose of the phone and where you will be using it. We’re more than happy to help you crunch the numbers!