WalMart & Prepaid: The Ultimate Commodization of Mobile Services

Jim Machi : Industry Insight
Jim Machi

WalMart & Prepaid: The Ultimate Commodization of Mobile Services

I should not have been surprised, though somehow it still struck a chord with me. And especially since Christmas is right around the corner, I should not have been surprised. But when I read the press release that Wal-Mart is launching Straight Talk, prepaid mobile plans including voice, messaging and Web access, I was surprised. The industry is officially commoditized. 
 
I certainly do not associate the Walmart brand with prepaid services, but then again I'm probably not the target audience. On the Web site, it is overly clear that the selling message is "no contract needed." And in this economic day and age, that certainly resonates. And they've done this with TracFone, which is the fifth largest wireless carrier in the U.S. This certainly makes sense for TracFone.
I would have expected the price to be better. I mean, when I saw the press release header, I went to read it since I really wanted to see the pricing. At unlimited $45/month of voice, text and Web access, it's O.K., but not great. T-Mobile, according to their Web site (at least from what I could figure out), gives something comparable at $50/month, including no contract. Verizon was more than that. AT&T seemed to be even more, though that was a confusing Web site visit (and maybe fodder for a future blog). Sprint didn't seem to have anything comparable. Anyway, I figured it would have been less. 
 
Walmart does have a $30/month which is limited voice, text and Web access, which seems good to me and useful. The 1,000 texts a month seems enough, but teenagers will likely have already done the math -- meaning 33 texts per day / 1.38 texts an hour in an average month, except in February when you could do 35 /1.46.


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