Sprint's Virgin Mobile to launch prepaid iPhone June 29
Sprint Nextel (NYSE:S) confirmed that its Virgin Mobile brand will follow Cricket provider Leap Wireless (NASDAQ:LEAP) to become the second U.S. prepaid carrier to offer Apple's (NASDAQ:AAPL) iPhone. The confirmation comes days after a report in the Wall Street Journal indicated Virgin would launch the iPhone soon.
Virgin will offer the iPhone beginning June 29 for $649 for a 16 GB iPhone 4S and $549 for an 8 GB iPhone 4. The prepaid carrier said its Beyond Talk pricing plans for the iPhone will start at $30 per month but will require customers to register for automatic monthly payments.
Virgin customers will be able to choose form a $30 plan with 300 voice minutes and unlimited texting and data, $40 plan with 1,200 minutes and unlimited texting and data and a $50 plan with unlimited voice, texting and data. All of the plans have a 2.5 GB data cap, after which customers' data speeds will be throttled for the remainder of their billing cycle.
Prepaid operator Leap will begin selling the iPhone 4S and iPhone 4 June 22. Leap's iPhone 4S will be available for $499.99 for the 16 GB model and the iPhone 4 will be available for $399.99 for the 8 GB model. Leap will offer the iPhone with its $55 per-month, all-inclusive unlimited talk, text and data plan, though after customers hit 2.3 GB of data in a month they may have their data speeds throttled.
The 16 GB iPhone 4S is often sold for $650 without a contract and the 8 GB iPhone 4 is often sold for $550 without a contract, putting Virgin's prices for the iPhone in line with the rest of the industry.
Adding the iPhone to Virgin will help Sprint increase the pool of potential customers it can offer the device to. Sprint began selling the iPhone last October to its postpaid customers after agreeing to a four-year, $15.5 billion contract with Apple to sell the gadget.
Leap is paying Apple $900 million over three years for the iPhone. Leap will only sell the iPhone in markets where it uses PCS spectrum, since the device does not support its AWS spectrum. Those markets cover 70 percent of its total covered POPs, which amounts to around 60 million POPs across the country. Those markets exclude major cities including Boston, Chicago and New York, but customers can roam onto other networks. In 2010 Leap inked an MVNO deal with Sprint that allows Leap to sell its services nationwide.
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