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Sprint's Virgin Mobile Adds PayLo Sub-Brand

7/15/2010 12:16:27 PM Eastern

Warren, N.J. - Sprint's prepaid
division continued to segment the growing prepaid market.

The company is doin so with a new
sub-brand called PayLo by Virgin Mobile, a pay-as-you-go service targeted to
low-usage consumers who mostly want to talk and want to keep their costs down
to about $20/month.

A 400-minute PayLo voice plan
costs $20/month, yielding per-minute charges of 5 cents. Less-frequent talkers
get the option of paying $20 to keep an account active for 90 days and make
calls at a rate of 20 cents/minute, the company said.

The PayLo service and handsets
are available at Virgin Mobile's website and
will roll out this month in drug and convenience stores as well as RadioShack
and Best Buy. Other Virgin Mobile-branded services, targeted to young social
networkers, are also sold through major retailers and drug and convenience
stores.

Sprint unveiled a multibrand
prepaid strategy

earlier this year, repositioning its Virgin Mobile brand mainly
toward young social
networkers and its Boost Mobile brand to talk and text users. Sprint also
launched a pay-as-you-go prepaid service -- Common Cents Mobile -- for
cost-conscious consumers who primarily use cellular voice and text. That
service became available exclusively
at more
than 700 Walmart in May. Sprint's other existing prepaid brand, Assurance Wireless, remained targeted to 37 million low-income households who qualify for free
government-paid service.

 All brands are
targeted at specific segments of an increasingly diverse prepaid market, the
company said.

Under its
previously announced multibrand strategy, Sprint is using the Virgin Mobile
brand mainly to target
youthful consumers "who use text and data services to
power constant connection with their social networks," the company said. For these consumers, Virgin's Beyond Talk plans offer unlimited
messaging, email, data and web access, plus a select amount of voice minutes,
starting at $25 a month.

"In
terms of marketing," a spokesperson said, "the focus [at
Virgin Mobile] will
be on Beyond Talk plans." On July 12, in fact, the
company launched a
"Crazy Life" ad
campaign to promote the
Beyond Talk Plans,
she said.

 The target demographic for the pPayLo by
Virgin Mobile sub-brand is different than that of the Beyond Talk plans, she
continued. "Beyond Talk plans are geared more for people looking to constantly
be connected on the go through social networking sites, email, IM and the web.
Pay-as-you-go customers are looking to use their cellphone primarily to talk.
Virgin Mobile is introducing PayLo to accommodate the needs of these
budget-conscious, cash-constrained and glove-box customers who are asking for a
no-frills approach to a pay-as-you-go offer with simple, easy-to-understand
plans and handsets."

 With the new PayLo service, available handsets
offer basic voice, voice mail, text messaging and caller ID functions. The
handsets include the LG101 at $19.99 and the Samsung M340 at $39.99. Customers
buy $20 and $10 Top-Up cards to activate voice minutes and pay for text
messaging, Web access, ringtones, downloads and the like. Consumers can also
add to their monthly balance via credit/debit card or PayPal account at
Virgin's website. Text messages cost 15 cents, and picture messages cost 25
cents. Customers who access the web pay a basic rate of $1.50 per megabyte.

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