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Boost chief: We won't get pulled into price war
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The head of Sprint Nextel's prepaid unit, Boost Mobile, said the carrier won't get pulled into a prepaid price war in the wake of rival MetroPCS' decision to cut the price of its unlimited plan.
"We're not going to get into a price war," Boost President Matt Carter said in an interview with the Associated Press. "We don't believe price alone is the only thing that drives our purchase behavior here."
Yesterday, MetroPCS unveiled a monthly prepaid plan at $40 for limitless voice, texting and Web access. The move caps months of back-and-forth on the issue; Boost shook up the industry earlier this year with the introduction of a $50 per month prepaid plan that includes unlimited voice, texting, Web access and Nextel walkie-talkie support. A few weeks ago, TracFone Wireless undercut that price with unlimited voice, text messaging and 30 MB of data for $45 per month, running on Verizon Wireless' network.
The issue is critical for Boost and parent Sprint. Indeed, Boost provided Sprint with 777,000 net prepaid subscribers in the second quarter, helping to offset Sprint's loss of almost a million postpaid subscribers in the quarter.
Despite the lowering floor for unlimited prepaid, Boost's Carter said the carrier currently has no plans to cut its pricing, but that it would instead focus on making sure its outdoor advertising emphasized the $50 price point. He also said he could not comment on how Sprint's recent acquisition of Virgin Mobile USA would affect Boost. Under the recently announced transaction, Sprint will acquire Virgin Mobile for$483 million and Virgin Mobile CEO Dan Schulman will run all of Sprint's prepaid operations. Carter will report to Schulman.
In related prepaid news, J.D. Power and Associates released a new survey on customer satisfaction that showed MetroPCS dropping from first place to last place. Boost came in third in the rankings, behind Net10 and TracFone.
For more:
- see this AP article
- see this BusinessWeek article
Related Articles:
MetroPCS unveils new $40 unlimited plan
Sprint loses 991,000 postpaid subs, promises additional webOS devices
Sprint buying Virgin Mobile USA for $483M
Analyst: Straight Talk plan getting traction in Atlanta
TracFone's $45 unlimited offer to 'stun' rivals
MetroPCS offers unlimited international calling
Comments
Posted by WilliamC | July 31, 2009 - 1:19pm
Get Motorola to make some watered down iden smartphones or the Palm Pre and Samsung Instinct 2(Dash) with walkie-talkie built in and its all over for the rest of those MVNO's. Why not some Nokia smartphones or some plain old blackberrys too. You will quiet them down real quick!!! Boost has options - If they would put their thinking caps on...............
Posted by Franklin273 | July 31, 2009 - 8:55pm
I agree with the president of Boost mobile cost alone is not the only reason for using a cell phone provider. However that said I would like to say that I use Net10 as it has no contract and thus no evil. Net10 provides exceptional service at an exceptional price.
Posted by Anonymous | July 31, 2009 - 11:10pm
Actually, just how many options does Boost have being partnered with Sprint who's being ordered to stop oeration of their iDEN network in the midwest by January 2010....
Now couple that with the honeymoon period just about over for the unlimited 50 plan as most are waking up to the fact that the service is terrible to non-existent for whatever price it's offered at and I'd say they're quite limited in options.
Posted by Anonymous | August 2, 2009 - 2:07pm
Just how are they low on options? These price/services they offer are on top with the big carriers, sure no smartphone yet, but regular cellphone/walkie talkie users are happy with the service
Posted by Anonymoose | August 6, 2009 - 4:10pm
They are running out of options because the $50 unlimited was a big draw at the time. That price has not only been beaten but like Anon said many people realized that cheap doesn't actually mean ANYTHING if you can't make or receive calls without constant dropped calls and bad lines. So with Straight Talk coming into the picture at 5 bucks less but (more importantly) on a better, much more extensive, reliable network, I would say that limits their options.
They should have gone for a price-cut - now it just looks as if they won't even try...
Posted by Workalot | August 11, 2009 - 9:44am
I think it's great that company's are giving better prices to customers. But I have been getting the lower prices for over a year now. People have their eyes fixed on the unlimited prices but I use my phone for many long distance and international business calls which are not included in these unlimited offers. Net10 however charges me 10cents per minute for all calls, that includes roaming, long distance and most importantly international calls to over 100 country's. Since I travel a lot and make an average of 5 international calls per day, I am really on the best cell phone package.
Posted by Augusta | August 21, 2009 - 5:55pm
There is no war. I found a company -- Tracfone -- that is offering their new plan "Straight Talk" to its customers. Its like Metro...but it's not. Its 45 dollars for the month and includes unlimited minutes and unlimited texting. They are also a nationwide plan...when we all know that Metro is definitely NOT. Good job Metro! Backing out of the competition.
Posted by BuzyB | August 27, 2009 - 8:57pm
I'm also a fan of StraightTalk, which runs on Verizon network. I never have reception issue (unlike my bestfriend who has Boost).
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