Sprint Unveils Four-Brand Prepaid Plans

By Joseph Palenchar -- TWICE, 5/17/2010

WARREN, N.J. — A new prepaid brand and a repositioning of the Virgin Mobile and Boost Mobile brands are part of a quad-brand prepaid strategy unveiled by Sprint.

Each of the four brands is targeted at specific segment of an increasingly diverse prepaid market, the company said. The launch will enable Sprint to drive prepaid growth without relying on price, explained prepaid group president Dan Schulman.

Under the strategy, the carrier’s Virgin Mobile brand will be repositioned to focus on young social networkers, while the Boost Mobile brand remains targeted to talkers and texters.

A new Common Cents prepaid brand, available exclusively through Walmart, will focus exclusively on pay-by-the minute service targeted at the budget-conscious. Sprint’s current Assurance Wireless brand will remain targeted at 37 million low-income households who qualify for free governmentpaid service.

Distribution of Virgin and Boost handsets will evolve with the change, a spokesperson told TWICE.

“With almost 60 million people now on prepaid service2, the no-contract market has clearly moved beyond the creditchallenged and lower income segments,” Schulman explained. Consumers “across multiple demographics and lifestyles [are] demanding a wide variety of handsets, features, and plans tailored to their specific needs and wants.”

The prepaid customer base has expanded to the point that in the first quarter, more than half of the gross subscriber additions in the U.S. cellular market were no-contract prepaid subscribers, Schulman said.

Under the Virgin Mobile brand, Sprint will target youthful consumers “who use text and data services to power constant connection with their social networks,” the company said. All of the new Virgin plans feature unlimited messaging, email, data and Web access, plus a select amount of voice minutes, starting at $25 a month and a new lineup of highend handsets.

The Virgin brand will continue to offer pay-by-the-minute service, but Virgin’s marketing will concentrate on the monthly plans, a spokesperson told TWICE.

On May 12, Virgin Mobile launched three “Beyond Talk” plans for its repositioned service. The $25 plan will be the industry’s lowest price-point plan for unlimited messaging, email, data and Web access and will include 300 minutes of voice calling per month, the company said. A $40 plan adds 1,200 minutes of voice per month, and a $60 plan includes unlimited voice.

Virgin will also offer BlackBerry data service for the first time. To each of the three plans, consumers will be able to add BlackBerry service for an additional $10 per month.

Under the Boost Mobile brand, Sprint will continue its recent focus on its current monthly unlimited pricing plans, which are targeted to consumers who talk and text but also include unlimited handset-based Web access.

The new pay-by-the-minute brand, Common Cents Mobile is targeted to budgetconscious customers who spend less than $30 per month. These “basic communicator” customers “just need a basic, nofrills phone service, don’t depend on their phones for everything, talk and text less frequently, and focus on how much they pay by the minute,” a spokesperson explained. The new brand was set to launch in May in about 16 markets to start.

About 63 percent of the prepaid customer base pays by the minute or by the day, the company noted.

Sprint will expand availability of its Assurance Wireless brand to about 25 states by the end of the year. The brand, launched last year and available in five states, offers free wireless service targeted under a government program to 37 million eligible low-income households.