Wild Wireless Winners

Peter : On Rad's Radar?
Peter
| Peter Radizeski of RAD-INFO, Inc. talking telecom, Cloud, VoIP, CLEC, and The Channel.

Wild Wireless Winners

I didn't know that Carlos Slim owned Tracfone. I also didn't know that it was on VZW's network. 

WalMart is a large retail channel for Tracfone, joining forces in 4Q09 to offer a $30 per month no-contract plan that consists of 1000 minutes, 1000 texts and 30MB of data. This plan (and a $45 plan) were introduced under the brand Straight Talk, offered through América Móvil subsidiary Tracfone Wireless.

Now: "Introducing Common Cents: Building off the success of StraightTalk, Walmart announces with Sprint the arrival of Common Cents - a new pay-as-you-go wireless solution that delivers an amazing value of 7-cent minutes that Round Down(TM) and 7-cent text messages - rolling out exclusively to 700 Walmart stores, starting May 15." [source

Online, WalMart pairs up with LetsTalk.com for mobile offerings from the Big 4 cellcos, but not Tracfone or any pre-paid. 

These pre-paid plans - from WalMart, Tracfone and Sprint - must be eating into Cricket, Leap and MetroPCS revenues. Rumors of a Metro-Leap merger are again floating around.

The other rumor is that Slim's Tracfone along with Sprint's pre-paid push will combine cheap phones from China with the Android O/S and App store to compete with post-paid. This will likely infuriate VZW, who will not want to share its LTE with Tracfone. Sprint may end up being a winner here, especially for M2M (machine-to-machine) applications. Maybe Slim buys Sprint.  I'm just noodling here. 

One point is that $30-$50 plans with no fees eats into ARPU for the Big 4 cellcos. And they have to burn billions in CAPEX to move to 4G/LTE/WiMax/whatever.  How do you pay for that with declining ARPU? And pre-paid is no-contract so the customer base is valued less than contract subscribers. This pre-paid move will likely affect handset makers too. (Not RIM or HTC but others like that fruit company).



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