As a cell phone expert, I’m worried about the future of prepaid carriers

Once dismissed as the domain of teenagers, bad credit consumers, or even shady activity, prepaid wireless has transformed into a real competitor in the smartphone age. Today, the prepaid market offers everything from ultra-budget choices to services that deliver an experience nearly indistinguishable from premium postpaid service. But this evolution comes with a new concern: over-saturation.

There are now well over a dozen reputable prepaid carriers, along with a seemingly endless wave of smaller providers. In 2025 alone, at least five new mobile services have either been announced or even launched already, including Klarna Mobile, SmartLess Mobile, Trump Mobile, Gerald BNPL Mobile, and an upcoming service from MrBeast. All of these are either tied to celebrity endorsements or backed by brands that have traditionally had no connection to wireless.

While there is nothing inherently shady about these newcomers wanting a piece of the pie, a crowded marketplace makes it harder than ever for customers to cut through the marketing jargon and find the plan that truly fits their needs. Let’s take a closer look at why so many new brands are appearing, what the big three networks have to gain from it, and how the strategy could ultimately backfire and make prepaid less appealing overall.

In the early 2000s, most prepaid users would have found the idea of prepaid fanbases a bit odd. Some people swore by Virgin Mobile as the best option for their teens, but they also swore at Virgin because the service was often a disaster. That is no longer the case. A quick look at Reddit shows a rising number of users who actively defend not only the big three carriers but also specific prepaid brands like US Mobile and Visible. The attachment to these companies is stronger now than it has ever been.

What has driven this change? For starters, today’s mobile devices are the central hub for digital life and a way to show off identity. For some, the thought of being without reliable service can even cause anxiety. At the same time, rising costs have pushed many toward alternatives to expensive postpaid plans, while still seeking reliability and coverage that matches what they already know. Once you find an option that works, it’s natural to stick with it.

Outside the mobile industry, an even bigger shift is taking place. Social media has transformed countless industries, largely through the rise of influencers. It’s not just about the brand’s quality or pricing anymore. The service you use says something about you as well. And if it’s endorsed by a celebrity or a brand you already trust? Even better.

Put these factors together, and it is easy to see why Donald Trump (Trump Mobile), Jason Bateman (SmartLess Mobile), Ryan Reynolds (Mint Mobile), and others are pushing into wireless. Simply put:

• More people are frustrated with rising prices from the big three carriers and are looking for alternatives.
• Many of these customers feel overwhelmed by the sheer number of prepaid choices, so turning to a name they already know and trust is an easy decision.
• Carriers like T-Mobile have made network improvements that make it easier than ever to launch new prepaid services as a new business, existing brand, or even as a celebrity endorsement.

For the major carriers, there are plenty of reasons to encourage more prepaid competition. Here are some of the most obvious drivers:

• Postpaid losses: As more customers leave postpaid plans, prepaid becomes a way to stop the bleeding. Prepaid carriers still run on the big networks, so T-Mobile, Verizon, and AT&T continue to profit by selling bulk network access to these companies.
• Low investment, high return: Providing network support for independent prepaid brands requires minimal resources, making it a win-win.
• Future acquisitions: Popular prepaid brands can become lucrative buyout targets. Mint Mobile, for example, started as an independent provider, grew in popularity with Ryan Reynolds’ backing, and was eventually purchased by T-Mobile as a sub-brand.

While not officially a reason, I’d argue the big three also benefit from a prepaid landscape filled with dozens of small, confusingly similar choices. A fragmented market makes it easier for them to market postpaid as the “premium” option without customers being able to easily compare all prepaid services side by side.

More choice sounds good in theory, but too much choice can overwhelm customers. Not all prepaid services are created equal. At one end of the spectrum, there are ultra-budget carriers aimed at teens or cost-conscious users willing to sacrifice speed and features. At the other end, premium prepaid brands like Google Fi, Metro by T-Mobile, Cricket Wireless, and Total Wireless try to replicate the postpaid experience or offer unique aspects you couldn’t get elsewhere. In between, you will find countless smaller players with their own twists, such as Helium Mobile.

As we have already seen with Trump Mobile, some services are also a bit less conventional and rely on gimmicks or celebrity appeal while presenting themselves as something greater than they are. With so many providers entering the market, one bad experience can sour a consumer on the entire prepaid sector. All it takes is a single poor trial for someone to walk away saying, “I tried prepaid, and it wasn’t good.”

The easier it becomes to create an MVNO (mobile virtual network operator), the more we will see services built on hype rather than substance. T-Mobile has leaned into this chaos most heavily, launching its “Your Name, Your Wireless” program last year. The initiative allows anyone to create a prepaid sub-brand that trades on existing reputation, while T-Mobile handles everything from setup and sales to app and website development.

Verizon and AT&T are not innocent either. Both have increased the number of prepaid brands running on their networks and have used targeted acquisitions to scoop up the most profitable players.

Ultimately, there’s nothing wrong with having more options. The real issue is having so many choices with only marginal differences that consumers feel stuck, overwhelmed, or misled into plans that do not suit their needs. Right now, it’s already hard to figure out the prepaid world without a lot of research, but if this flood continues, it will only get worse.

What do you think about the current state of mobile and the rise of prepaid sub-brands from celebrities and non-mobile companies? I’d love to hear your take in the comments.