FreedomPop launching with 25 European operators, sees 40% of Euro customers buying services
BARCELONA, Spain -- FreedomPop last month announced plans to launch its free MVNO service in Europe with 25 carriers, and it isn't dawdling. All 25 markets will be up and running by the end of this month, according to Nicholas Constantinopoulos, who oversees the company's international operations. And it has its sights set on much more than that.
FreedomPop, which offers limited buckets of free voice, text and data and encourages its users to buy value-added services, runs on Sprint's network in the U.S. The company last month announced $50 million in additional funding, bringing its total funding to more than $190 million, and said it planned to ramp up overseas in a big way after launching in the U.K. last spring.
And while some freemium-based businesses may shy away from the model, Constantinopoulos is very clear about how FreedomPop makes money.
"FreedomPop ultimately is a platform to sell digital services," he said simply. That often means getting people to pay just a small amount every month for something like a second phone number with a different area code for use in a specific region. "Freemium is just about bringing people on board."
The company's international plans include 200 MB per month of free data in the supported countries and can be accessed by any connected device including smartphones. Users may purchase additional data at $10 per 500 MB. FreedomPop also launched a global hotspot for $50 and a SIM card that is available on the company's site for $10.
The MVNO claims more than 1 million customers, almost half of which pay at least something regularly. Constantinopoulos said FreedomPop sees a 48 percent conversion rate from free to paid services in the U.S., and a 40 percent rate in Europe.
"And the people who convert, they remain there," he said, citing loyalty rates of 80 percent to 90 percent. Those who use only free services are an acceptable cost of doing business, Constantinopoulos said, adding a reasonable amount to the cost of customer acquisition. And European operators are embracing MVNOs, he continued, because it provides a way to differentiate their offerings in a competitive and saturated market.
"The MVNOs are the only actual way for the MNOs [mobile network operators] to achieve growth," he maintained.
FreedomPop has partnered with Axiata, a large Asian telecom group headquartered in Malaysia, to jointly develop a range of products and services that could come to market in Europe, Asia and South America. And Constantinopoulos implied FreedomPop may even be looking beyond the MVNO model as it expands its worldwide footprint.
"MVNO is a way to enter new markets," he said.
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