CDMA Prepaid

Due to heavy competition from GSM counterparts, CDMA operators like Reliance and Tata Indicom launched prepaid services for their users.The concept of prepaid service of CDMA operators is not very different from GSM operators. Both provide rechargeable coupons.

If a GSM prepaid user fails to recharge within validity period, he can continue to receive messages and calls within grace period. And even beyond Grace period,he/she can simply buy a new SIM card for 99 bucks and pop it into his/her existing phone.

However the case with CDMA operators is different. If the prepaid coupon is not recharged within the grace period the connection is deactivated and the phone is rendered useless. To get connected again, you need to pay the cost of recharge plus the cost of new handset. The existing handset becomes useless!In fact, the Terms and Conditions section of Customer Application, of Reliance says, "Once cancelled, Prepaid service cannot be reactivated."

In other words, if someone's Reliance prepaid connection is deactivated, then he has to repay the minimum amount of Rs.2999 for both the connection and the handset. Similarly if somebody is a Tata Indicom mobile user he needs to repay Rs.4000, which includes a handset and two rechargeable coupons.

It is quite understood that CDMA mobile handsets cannot be used like GSM handsets with variable service providers due to technical reasons. But it still remains unclear, why users cannot reuse their handsets with the same service provider once his initial connection is cancelled. Is this because of technical problems or sort of business strategy?