Sprint’s Prepaid Multi-Brand Strategy Focuses on Distinct
Thursday May 06, 2010 - 07:00 AM EDT
Source: Business Wire News Releases
Click here to read the original story
Sprint [NYSE:S] today officially unveiled its comprehensive multi-segment approach to the prepaid wireless
marketplace. Since Sprint's acquisition of Virgin Mobile USA, Inc., the company has rolled out a series of
new prepaid products, enhancements and industry-advancing products, each designed to appeal to specific
customers in the wireless space.
"We brought together the resources and experience of the Boost and Virgin Mobile teams in late 2009," said
Sprint CEO Dan Hesse. "Since that time, we have been developing the critical pieces of our multi-brand
prepaid strategy. Our approach to the prepaid market can truly set us apart from the competition with tailored
offers that will address specific needs in this growing market."
"This is the year that prepaid moves to the forefront of the wireless industry," said Dan Schulman, president of
Sprint's prepaid group. "In the first quarter of 2010, more than half of the mobile gross additions in the U.S.
selected prepaid, and we predict that approximately 70% of the net adds in 2010 will choose plans without a
"With almost 60 million people now on prepaid service2," Schulman continued, "the no-contract market has
clearly moved beyond the credit-challenged and lower income segments. The prepaid market has changed
dramatically, with customers across multiple demographics and lifestyles demanding a wide variety of
handsets, features, and plans tailored to their specific needs and wants."
Sprint's prepaid portfolio will initially be driven by four brands, with each focused on a specific audience.
"The launch of this portfolio goes far beyond changing prices," explained Schulman. "We are introducing
innovative and attractive offers for specific groups of customers based on usage and habits â’ from those
who are on limited budgets and use their phones infrequently to those who want high-end devices to use for
all their communications, entertainment and social networking."
Virgin Mobile USA
Reinventing prepaid wireless once again,Â Virgin Mobile will introduce an innovative new value proposition
that focuses on serving customers who use text and data services to power constant connection with their
With unlimited messaging, email, data and web included on all plans starting at just $25 a month and a new
high-end handset lineup, Virgin Mobile will offer a clear alternative for customers who want a data-driven
service without expensive annual contracts and thousands of unnecessary voice minutes. With the addition of
the lowest-priced BlackBerryÂ® service plan in the market, Virgin Mobile will provide real value for
individuals looking to stay connected without compromising on handset or service quality.
The way youth and young adults communicate has changed dramatically over the past few years. Data from
Nielsen3 shows that usage patterns for postpaid mobile subscribers aged 18-34 shifted from 2007 to 2009.
Minutes of talk dropped over 10% while messages sent and received grew by more than 150%. The amount of
data usage within this group grew by over 1800% during the same time period.
Beyond Talkâ ¢
On May 12, Virgin Mobile will unveil three new "Beyond Talk" plans that all include unlimited messaging,
email, data and web [with no incremental fees or taxes4]:
• The revolutionary $25 plan is the industry's lowest price point for unlimited messaging, email, data
and web with 300 minutes of voice per month, ideal for high-end device users seeking an unbeatable
price to enable the text and data services they need.
• The $40 plan includes unlimited messaging, email, data and web with 1,200 minutes of voice per
month -- the perfect value for those seeking an affordable plan with everything they need.
• The $60 plan includes unlimited messaging, email, data and web with unlimited voice to offer great
value for high-end smartphone users expecting an unlimited plan to cost much more.
For the first time, Virgin Mobile customers can add BlackberryÂ® data service to any of these plans for just
$10 more, enabling an unprecedented $35 plan consisting of both voice calling and Blackberry data service.
"Our new offers target a continuing evolution in wireless consumer behavior â’ increased use of text and
data services as a form of wireless communication over talk," explained Schulman. "These Beyond Talk plans
offer the most accessible solution for customers seeking that data-driven lifestyle -- unlimited text and data on
their terms without a contract, at prices they will love, without requiring them to buy extra minutes they don't
Virgin Mobile's new handset lineup proves that a two-year contract isn't necessary to get a hot data-driven
• The Blackberry Curveâ ¢ 8530 smartphone is a particularly desirable device without a contract.
Key features include an approachable form factor, full-QWERTY keyboard, optical track pad, Wi-Fi
connectivity, dedicated media keys, and 2 MP camera. The Blackberry Curve 8530 smartphone will
be available for $299.995at retail and at www.virginmobileusa.om at the end of May.
• The LG Rumor Touchâ ¢ at $149.99 is the first full touch interface handset from Virgin Mobile and
is only available without a contract on these plans. Customers can use all the data they want and
message all of their friends easily and simply with a Beyond Talk plan. This handset is ideal for the
super-connected with an external memory drive that can store up to 16GB of data.
• The very popular LG Rumor 2â ¢ QWERTY launched last year, also only available without a
contract from Virgin Mobile. For $89.99, it allows customers to message quickly and easily with
preloaded apps like the Ultimate Inbox, threaded messaging and Connect social networking. The
popular Opera Mini web browser is included as well.
• The Kyocera Loft QWERTY for $69.99 suits message-savvy customers perfectly with an embedded
instant messaging and email application, and message threading for SMS and MMS in a single inbox.
The camera phone includes the networking features mentioned above as well as a Google Maps and
other navigational applications.
Virgin Mobile USA continues to serve its current base of prepaid customers with a wide range of handsets,
monthly unlimited plans, Minute Packs, Texters Delight and Broadband2Go.
Broadband2Go, launched last year under the Virgin Mobile label, also targets the needs of the high data-using
crowd that wants easy wireless Internet access wherever they are but doesn't want to sign a long-term
"Since we expanded distribution, lowered the price, and added more data capacity without changing prices,
sales have tripled," said Schulman. "We'll continue to enhance this product line as well, possibly under
multiple brands to include new services and the very latest in high speed networks, including 4G where
Broadband2Go operates on Sprint's Nationwide Network, unlike other prepaid broadband offers.
Boost Mobile continues its popularity by focusing on consumers who love to talk and text and stay connected
with the best value and straightforward monthly unlimited pricing. With more than 25% of U.S households
now wireless-only for voice6, Boost offers value and service that is second to none. This week, Boost added
unlimited 411 calls, email and instant messaging to its $50 Monthly Unlimited plan, which also features
unlimited talk, text and web access.
Boost's ever-increasing suite of CDMA handsets, introduced in late January, is driving significant consumer
demand. The Blackberry Curve 8830 smartphone, launched earlier this year, is joined by the Samsung
Rantâ ¢ and, from Sanyo by Kyocera, the Incognitoâ ¢, Mirroâ ¢ SCP3810 and Junoâ ¢ on the CDMA
side. Depending on a customer's choice of features, Boost Mobile also is available on the Nextel National
Network for push-to-talk technology.
First launched late last year, Assurance Wireless is a free wireless service developed specifically for the 37
million eligible low-income households who need it most. Qualifying customers â’ often cash-constrained
individuals eligible for government- assistance programs like Supplemental Nutrition Assistance Program
(SNAP, or food stamps) â’ receive a free cell phone and 200 free minutes of airtime for local and
long-distance calling every month.
Sprint is "proud to offer this valuable program," according to Schulman, which is currently available in
Michigan, New York, North Carolina, Tennessee and Virginia and will continue to expand as individual states
approve the program. To date, hundreds of thousands have signed up for this uniquely tailored offer. Sprint
anticipates that Assurance Wireless will be available in approximately 25 states by the end of 2010.
A New Pay By the Minute Brand
During Sprint's first quarter earnings call, reference was made to another new brand to launch this month
targeting budget-conscious customers who spend less than $30 per month and are focused on the value they
pay per minute. Roughly 63% of the no-contract market chooses to pay by the minute or by the day.7
"There are millions of people who don't want or can't afford smartphones and expensive data plans," said
Schulman. "This is the traditional no-frills prepaid customer base. For these â’ basic communicators,' we are
creating a fresh brand with industry-leading value and consumer-friendly offers." Designed to resonate
directly with cost-conscious consumers, this new brand is expected to initially debut at retail in approximately
About Sprint Nextel
Sprint Nextel offers a comprehensive range of wireless and wireline communications services bringing the
freedom of mobility to consumers, businesses and government users. Sprint Nextel is widely recognized for
developing, engineering and deploying innovative technologies, including two wireless networks serving
more than 48 million customers at the end of the fourth quarter of 2009 and the first and only 4G service from
a national carrier in the United States; industry-leading mobile data services; instant national and international
push-to-talk capabilities; and a global Tier 1 Internet backbone. The company's customer-focused strategy has
led to improved first call resolution and customer care satisfaction scores. For more information, visit
1 From Sprint Corporate Research, 2009.5 Market Profile, December 2009
2 New Millennium Research Council, March 2010
3 Nielsen Customer Value Metrics analyzes the wireless service bills of more than 65,000 postpaid wireless
subscribers. Stated numbers represent averages for voice, text and data usage on subscriber bills during the
4 Some point of sale taxes may apply.
5 Handset prices exclude taxes.
6 Morgan Stanley Telecom Services 2/2010.
7 Q4 2009 Nielsen Prepaid report.
Corinne Nosal, 908-607-4235
Powered By: FinancialContent Services, Inc.
Nasdaq quotes delayed at least 15 minutes, all others at least 20 minutes.
By accessing this page, you agree to the following terms and conditions.
Conference calls info supplied by OpenCompany
Fundamental data supplied by Morningstar
Stock quotes supplied by Telekurs USA