Lifetime prepaid to boost mobile adoption

Airtel has introduced a lifetime prepaid cellular service in India and four other operators immediately responded with similar services.  This is significant, but first what is it?

With most prepaid accounts if you don't recharge the account for some period (6 months, 3 months or as little as 30 days) the account expires.  You can no longer receive calls and you lose the phone number.

With lifetime prepaid, you can let your credit run to zero but still receive calls, indefinitely!  In developing countries with low mobile phone penetration, this is very significant. 

As Veer Chand Bothra says

Companies can now actually give it to all their field staff who need to be reachable but don’t often need to make a call - drivers, courier boys, collection agents etc.

Also in India, as in most developing economies, middle class families can afford servants -- a cook, gardener, driver, etc.  In my discussions with friends in Pakistan, it's clear that even with prepaid accounts that expire, it's worth giving mobile phones to your servants so you can reach them whenever you need to.  I've also heard stories in several developing countries of people obtaining mobile phones for elderly parents in remote villages.  Whatever the reason, these new prepaid accounts in India will significantly boost mobile adoption and drive additional minutes, even if the lifetime prepaid customers only receive calls.

Mobile phone adoption depends on network effects.  A phone is only valuable when there are people you want to call and it becomes more valuable when there are more people you want to call.  Lifetime prepaid provides a low cost way to significantly expand the pool of people you can call at a very modest expense. And, it encourages those with money to pay for phones for those who otherwise would have put off the expense. Mobile operators in other developing countries should follow this example.

Footnotes...

• What does it really cost to equip someone with a lifetime mobile?  Used handsets are available for less than $20 and the lifetime prepaid card is Rs 999 (roughly $22).
• Is there any fine print?  Yes, but not too onerous.  If there is no activity whatsoever (no incoming calls or incoming messages) for six months then the account is dropped.