New Users & Aggressive Marketing Move The Prepaid Calling Card Market Forward.

Since its launch in the early 1990s, the prepaid calling card market has experienced impressive double-digit annual growth, reflecting the accelerating demand for prepaid telecommunications services. IDC reports the market for prepaid calling cards will continue to expand, with revenue growing from $3.4 billion in 2000 to $5.3 billion at the end of 2005.

“Although the prepaid market is still dominated by the credit challenged, ethnic minorities, and lower-income consumers, the typical prepaid calling card user is becoming less defined,” said Amy Harris, analyst with IDC’s Residential Telecommunications Services program. “We see more business users and colleges students purchasing prepaid calling cards as well as a growing segment of users that view prepaid cards as convenient to use and a helpful tool to control their long distance calling costs.”

With long distance prices continuing to decline, IDC believes price is no longer a key differentiator in this market. For service providers, the creativity of their marketing organizations and the quality of their merchandising and promotional materials are factors increasingly driving success in the prepaid card market.

“The marketing of a prepaid calling card is more important than the quality of the calls or the value-added services that might be offered on a card,” Harris said. “Moreover, to attain success in this market, service providers need to expand their distribution channel relationships with retailers such as Costco, Target, and Texaco.”

For more information at http://www.idc.com.