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Prepaid Wireless Tracker #48, June 2012 - Cricket To Be 1st U.S. Prepaid Carrier To Sell iPhone!
June 01, 2012

Prepaid Wireless Tracker - June 2012 Issue #48


Prepaid wireless is a growing and truly exciting industry.  At I try to provide you with in-depth information that isn't readily available anywhere else.  Its content is original, and created from firsthand experience working in the prepaid wireless industry.

This monthly email provides you with a quick glance at what's in the news so that you can easily keep informed.  I believe in brief, to-the-point summaries/commentary so that you can move onto other tasks in your day.  Each snippet includes a link to the original story should you be interested in the full details.

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Cricket Communications First U.S. Prepaid Carrier To Offer Apple iPhone
Starting June 22nd, customers can purchase an iPhone 4 or 4S for $399 and $499, respectively, on a $55 per month unlimited plan.  There have always been ways to get iPhones on prepaid plans, however, that requires some savvy, and some features often wouldn't work (like data!).  This official offer changes the game for prepaid carriers forever.  I expect that the high price tag will certainly be a barrier for many, however, with the low monthly cost compared to contract plans, customers ultimately get a better deal spending more upfront for a no contract plan.  Of course, here in America, we often think mostly about the short term (i.e. upfront) costs; nonetheless, this is just the beginning.  Hopefully Cricket will be able to do a fast follow with the iPhone 5 once it becomes available, or customers will flock to used iPhone 4s and activate them on Simple Mobile now that T-Mobile is going to enable access to its high speed 4G network for iPhone users later this year.  Lastly, don't expect Sprint to follow too quickly here as their management is too terrified to cannibalize its postpaid business.  Sprint would have otherwise been the most logical carrier to be the first to launch the iPhone on its no contract Virgin and/or Boost brands.  Hopefully the economics of the deal are sufficient for Cricket to grow a successful iPhone business, and to continue to lower prices, as well as access newer models before they become obsolete.

T-Mobile MVNO Simple Mobile Acquired by TracFone

Simple Mobile is a Bring Your Own Device MVNO that sells SIM cards and service only.  They've been growing quite successfully, and would probably grow faster if more people were aware of its benefits.  TracFone likely acquired it to gain access to its growing distribution, as well as its growing iPhone base.  I think they probably picked it up for a bargain as Simple hasn't quite reached critical mass yet.  I would have liked to see it grow more before being gobbled up.  Perhaps cash flow was an issue and the founders figured this was a good time to take a bunch of cash and run before the inevitable business complexities challenge its growth potential.

Contract Wireless Subscribers See A Decline
I've been reporting for years that prepaid wireless makes more sense than contract wireless.  Now that the phones available on prepaid are getting increasingly more competitive (and high end), consumers are catching on.  This is apparently the first time in the history of the wireless industry that contract providers have seen an overall loss of customers.  A short article, but a powerful point!

New Prepaid Carrier Voyager Mobile Launch Delayed Due To Web Attack
PC Magazine
Voyager Mobile, a new Sprint MVNO, reported some kind of website attack that delayed its launch by approximately two weeks.  Hmm, I don't know what kind of attack could occur on an unknown company with a website with no traffic, but hopefully things have been ironed out, and Voyager can show that it has a viable business model.  It has some good ideas regarding launching a rewards program, however, at present it appears to be a pure low price play, which won't be sustainable as history has shown.

Canada's Wind Mobile Sees Growth Decline
Reuters Canada
Trying to mimic the success of prepaid wireless growth in the U.S., several similar unlimited carriers launched in Canada in 2009.  One of them, Wind Mobile, is now reporting a sharp decline in subscriber growth.  This is likely due to the incumbents, like Rogers chtr, successfully beating down these new disruptive carriers.  Hopefully this is not an indication of a long term result for these new carriers, as that would only be to the detriment of customers.  Come on Wind, keep the fight going!

Boost Mobile Offers Third Party Visual Voicemail For a Ridiculous Fee
It's almost fair to say that this isn't really news worthy.  However, I included it to point out how pathetic some management teams can be.  Why launch visual voicemail (on May 31) when you can download Google Voice's Android application for free, which also includes voice to text.  I've been using GVoice for years and while it's not perfect, it's really very usable, and of course it's free.  Who in their right mind would may $1.99/month for such a service - even if there weren't a free alternative?!  I can tell you that I barely ever leave people voicemails anymore as it's more about text messages and emails these days, and I know that I'm not alone on this.  Sorry Boost, this is a sad demonstration of company resources management and priorities.  Or perhaps Smith Micro has an exceptional sales force!

Virgin Mobile Offers 4G WiMAX
Hot Hardware
I reported last month that Sprint was enabling its Boost Mobile and Virgin Mobile brands with access to 4G.  This month we get more details about the Virgin offer, which includes a 4G MiFi hotspot and USB modem.  This is really the only move Sprint could do to keep these brands relevant as all prepaid carriers are in the process of moving to 4G.  Although Sprint's 4G WiMAX network will be short lived, so long as it can migrate to LTE before WiMAX becomes completely irrelevant, this is a wise interim strategy.  It even puts them ahead of the competition with respect to decent 4G broadband coverage that other prepaid providers don't yet have.

T-Mobile Launches Vesta Powered Android Payment Application
This native Android application enables T-Mobile prepaid wireless customers to make payments and signup for automatic payments using their smartphone.  I've had the opportunity to tinker around with this app; it's pretty straightforward and user friendly.  Really, every prepaid carrier should have an application like this as adding money to an account is the most important thing a customer can do when interacting with a no contract company.  The fact that it's taking carriers so long to get these apps out is just short of astonishing if you ask me.  For carriers waiting to build a full service account management Android application (that includes payment capabilities), you're making a big mistake; please let me use a dedicated payment application if I so choose!

Walmart Teams With U.S. Cellular & Alltel Wireless On Walmart U Prepaid Brand
Richmond County Daily Journal
So Walmart is at it again, creating a new brand and offers for exclusive distribution in its stores.  U Prepaid will initially have limited distribution, and depending on where you live will either operate on the U.S Cellular or Alltel networks.  The plan details are a little vague at this point, and handset selection appears to be limited at launch.  I expect that after its tremendously successful launch of its exclusive Straight Talk unlimited brand via a partnership with TracFone, it's seeking to scale that success to non-unlimited no contract offers.  I don't know; the market is already pretty crowded.  Can consumers digest yet another prepaid brand, or will it simply introduce additional confusion?

What's New at

  • Updated Prepaid Wireless Broadband Plans & 4G Broadband to reflect the discontinuation of Best Buy Connect on 6/1/12

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