Whether we like it or not, my wife and I recently became statistics. About eight weeks ago, we moved back to California after spending two years in Germany. We had a suspended T-Mobile USA contract while we were away and were likely going to re-activate it on our unlocked iPhones upon our return. But knowing that we’d only get EDGE speeds on our phones back in the US, it didn’t seem worth it to pay well north of $100 for two phones per month.

So we made the jump—becoming two more of the many Americans who have recently made the switch from postpaid to prepaid.

New industry data released in May shows American mobile phone operators have been hit with the first-ever net decline in contract (“postpaid”) subscriptions, a loss of 52,000 subscribers. And the number of non-contract ("prepaid") mobile customers has reached record levels—now accounting for about 25 percent of all mobile phone users in America.

“While one data point doesn’t make a trend, we are approaching the peak of the curve where new, traditional postpaid subscribers will be hard to find,” wrote Chetan Sharma, a mobile industry analyst, in his Q1 2012 report. “It is possible that the newly minted prepaid subs might return to postpaid subscriptions. The shift is correlated to the economic woes. Majority of the new subscribers will come from connected devices as we have been saying for the last couple of years.”

That 25 percent of American mobile phone customers? Sharma told Ars it pales in comparison to most other parts of the world. Western Europe is about 70 percent prepaid. China, India, and Africa reach 70, 95, and 99 percent, respectively.

But the American mobile industry is at a turning point. It’s becoming harder and harder for companies to attract new customers—110 percent of American residents already have cell phones. There are more mobile phones than people.

The industry is still experiencing growth, however. "Connected devices" refers to entities that use a mobile network, but that aren’t traditional phones—your iPad, Galaxy Tab, or some other tablet-style device. Sharma’s report shows that this segment of the mobile market grew 23 percent even as prepaid mobile service rose 15 percent (both beating out postpaid growth, which only went up by just 1 percent). And while Verizon remains the country’s top postpaid carrier, AT&T is leading the pack in providing data to connected devices, and Sprint leads with prepaid customers. Data now constitutes 85 percent of all mobile traffic in the United States.

In other words, we all want more service on more devices. But we want to also save more money while doing it, and that may mean moving toward prepaid services.

As postpaid falls, carriers adapt

Carriers across the United States are aware that customer habits are changing—both AT&T and Verizon have said they’re working on shared data plans across multiple users and devices. This month, AT&T announced that data-only plans would be coming within two years.

“The key advantage is that then you can tailor your usage according to your cloth, so to speak,” said Windsor Holden, an analyst with Juniper Research. “It can be considerably cheaper, and there’s an increasing amount of competition for prepaid services.”

Many new mobile virtual network operators (MVNO) are now launching. These are companies that lease spectrum and towers from the big four. There's Ting (which some Ars readers have already discovered) running on Sprint’s network, as well as payLo (Virgin’s new brand, also on Sprint), which hit the market May 21. Verizon, meanwhile, announced its $80 unlimited everything plan at the end of last month. T-Mobile just announced a slew of prepaid, month-to-month portable data options. Heck, some analysts even expect Apple to launch a prepaid version of the iPhone 3GS—Cricket did just that at the end of last month, except with the iPhone 4 and 4S.

Sprint has been one of the innovators in this area—probably because it has been the big player facing the biggest problems as a company. Indeed, with Sprint’s new offerings being resold by Virgin, Boost, and now Voyager, the company seems to be poised to take advantage of the rising prepaid market.

“Most of the world doesn’t live with contract anyway, and that was the only place we were going to be able to grow,” Jayne Wallace, a Sprint spokesperson, told Ars.

She added that historically, prepaid phones were “crappy.” Sometimes it was hard to sell this service, especially when there were better handsets available on postpaid plans.

“From a marketing standpoint, we would use the term ‘no-contract’ rather than 'prepaid.' That has a negative connotation with people,” Wallace noted. But switching away from a contract—and convincing your friends and family to follow suit—still poses challenges that don't exist in other markets.