Prepaid Wireless Tracker - September 2012 Issue #51

Hi,

Prepaid wireless is a growing and truly exciting industry.  At Prepaid-Wireless-Guide.com 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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RadioShack No Contract Wireless Launching September 5th
Engadget
RadioShack is launching its own branded (powered by Cricket) prepaid wireless program on September 5th.  The top tier smartphone plan gets you a $5 discount over Cricket's similarly featured plan, however, the question really boils down to: Does the market really need another brand?  RadioShack sells a lot of wireless; there's no doubt about that.  However, can it really pull in more revenue with its own brand?  I predict that the program will go bust, ultimately shutting down within three years.  Sorry RadioShack, but this is simply a bad idea.  Stick to your core competency and perhaps add to your portfolio of available carriers.  Perhaps go as far as to get an exclusive on a fully featured smartphone at a ridiculously low price, or a hot smartphone not available anywhere else.  But an entirely new brand, ugh.  I think you'll find that managing the program will be far more complex and expensive than you realize, and won't bring in the sales that you expect.  It will be interesting to see how this pans out!

Virgin Mobile Finally Begins iPhone Advertising
Total Telecom
So after receiving approval on their marketing plan from Apple, Sprint will be promoting Virgin's iPhone for one month.  Truth be told, Sprint is only selling the iPhone on prepaid to help meet their sales commitment to Apple.  Time will tell whether customers are willing to fork over the absurd amount of dollars for this device, when equally, and arguably more feature rich Android smartphones are available at half the cost.  Also, with the iPhone 5 just around the corner, a major price drop would be required to attract any sales of the outdated iPhone 4.

Ready Wireless Makes Fortune 5000 List
Congratulations to Ready Mobile for making the list of 2012 fastest growing private companies!  With its new MVNO enabler relationship with Sprint, I expect their revenues will continue to grow nicely.

Boost Mobile & Virgin Mobile To Launch Their Own Samsung Galaxy Series Phones
CNET
In September Boost is getting the Galaxy S2 4G (WiMAX), and Virgin is getting the Samsung Reverb.  You can read the article for the specs.  The key point here is just to keep up with new smartphones coming to town on prepaid.  The options are certainly starting to catch up to postpaid!

MetroPCS Launches Truly Unlimited 4G LTE Plan For $55
BGR
The unique aspect of Metro's plan is that it's said to be truly unlimited.  That's in contrast to other prepaid carriers that advertise unlimited data, but actually have a data allowance after which they throttle speed to the point of dial-up or worse (i.e. unusable except for app-based email).  With growing customer frustration around unlimited plans that aren't truly unlimited, this type of approach is wise.  They're marketing it as promotional, which means they need to evaluate the impact in terms of gaining new subscribers, versus the profitability of customers having access to unlimited data.  At that price point, with tethering disabled, it should be sustainable.

Leap's Poor Financial Performance Ignites Company Sale Rumors
Vision 2 Mobile
There have been rumors of a Leap sale or merger with MetroPCS for years.  However, its performance this year so far has been extremely poor.  Of course, one or two quarters, or even a year of poor performance is not necessarily a prediction of future performance.  Wireless platforms have an 18-month lifecycle, and turning the ship takes time, so good decisions can take time to take effect.  With a new CFO that recently joined the company, hopefully it will be able to get its cash flow under control.  It's amazing that its CEO has survived this long after leading the company into bankruptcy over a decade ago.  Sprint is the most obvious buyer given that it already has an MVNO relationship, and has a proven track record of funding (not managing!) prepaid brands.  Cricket was smart to note that every option is on the table, as that's probably the only comment that could reasonable fend off analysts (who are usually unqualified in prepaid wireless to really add value to the discussion, but that's another story).  Don't expect anything to happen this year.

Virgin Mobile Launches Samsung Feature Phones
Unwired View
Yes, feature phones (i.e. basic, non-smartphones) are still alive!  However, there are obvious signs that some prepaid wireless providers are slowing down or even outright eliminating feature phone launches.  I've even seen dumbed down Android phones being positioned as feature phones.  In other words, paring down Android (no access to Google Play, removal of smartphone app and data features, etc.) is less expensive than managing the customization and launch of feature phones that usually come with OEM software interfaces.  This isn't necessarily a bad thing, as your basic contacts, calendar, and navigation will feel similar and make a transition to a smartphone much easier.  In the meantime, hardware running such a dumbed down operating system requires less processing power, memory, and the like (i.e. lower cost).  Certainly we can all foresee a time where there's no such thing as a feature phone, however, in the meantime, there are still feature phone launches trickling in with little fanfare.

Simple Mobile Reduces Unlimited 4G Plan to $50
IntoMobile
Not a bad deal for an unlimited 4G plan!  Recall that Simple Mobile runs on T-Mobile's network and was recently purchased by American Movil, parent company to TracFone.  They're a 100% Bring Your Own Phone (BYOP) business model, and one of the easiest ways to get a prepaid iPhone (which, of course, doesn't currently have any 4G models).  Hopefully Simple doesn't price itself too low where it can't remain profitable.  In the meantime, if you have your own unlocked GM phone, Simple Mobile is certainly a no contract provider worth considering.

Cricket Adds Muve Music To All Android Plans
USA TODAY
Cricket is introducing three new Android plans that now all include its unlimited Muve music service; no need for an additional add-on or buying up to the top tier plan.  I haven't heard anything about Muve being added to its iPhone offering, however, I imagine that's inevitable.  Apple doesn't like looking like they have an inferior product, however, they're also very difficult to work with in terms of changing their devices for carriers, so perhaps a Muve app is the only option.  When information about that surfaces, I'll certainly report on that!


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