According to a recent report from NPD, prepaid smartphones are increasing in popularity with U.S. consumers. In the first quarter, prepaid smartphones represented 32% of all smartphone sales, an increase of 11 percentage points year over year. Not only is this trend troubling for telecoms, which benefit from post-paid data plans, it could also spell trouble for Apple's (AAPL -0.22%) very expensive iPhone. In this video, Fool contributor Steve Heller examines the report and gives viewers a look at the competitive landscape.