T-Mobile to launch GoSmart Mobile prepaid offering nationwide in February
T-Mobile USA is planning to take its GoSmart Mobile prepaid brand nationwide in February, according to people familiar with the matter. T-Mobile declined to comment on the issue.
T-Mobile is currently seeing strong demand for GoSmart in its test markets, sources said. T-Mobile launched GoSmart in "select markets" in December, and said at the time that it will be "using what we learn to make a decision about a potential national launch sometime in 2013."
T-Mobile's GoSmart is available at three price points: $30 per month for unlimited voice and texting, $35 for unlimited voice, texting and 2G Web service, and $45 for unlimited voice, texting and "high-speed" Web service. The $45 plan includes 5 GB of data per month, after which users' connections are slowed to 2G speeds.
Interestingly, T-Mobile also noted that "certain T-Mobile plans may be prioritized over GoSmart Mobile plans during periods of congestion."
GoSmart currently offers two handset options on its website: The Alcatel OT 838 for $49 and a "mobile SIM kit" for $8 that will allow users to connect unlocked GSM phones to the service.
GoSmart, which is owned and operated by T-Mobile but is sold as a separate and unrelated brand, is similar to Sprint Nextel's (NYSE:S) prepaid strategy, which stretches across the Virgin Mobile, Boost Mobile and Assurance Wireless brands. The strategy allows T-Mobile to tap into the low-cost prepaid space without using its primary brand. T-Mobile also offers prepaid service through the "Walmart Family Mobile" brand, which is advertised as using the T-Mobile network.
It's no surprise that T-Mobile is targeting the prepaid space. In the third quarter, T-Mobile added 365,000 new prepaid customers and lost 492,000 branded postpaid customers. Further, T-Mobile is working to merge with regional prepaid carrier MetroPCS (NYSE:PCS), and plans to take the MetroPCS brand nationwide.
T-Mobile's GoSmart Mobile prepaid brand could create headaches for a number of new T-Mobile MVNOs. For example, Ultra Mobile, Ready SIM and Solavei are three MVNOs that recently launched low-cost, prepaid services using T-Mobile's network. If T-Mobile provides more favorable pricing through GoSmart, that could put T-Mobile's MVNOs at a competitive disadvantage.
T-Mobile isn't the only carrier that appears to be refining its prepaid strategy. Verizon Wireless (NYSE:VZ) is rumored to be planning the launch of two new prepaid plans Feb. 1. According to Phone Arena, Verizon will offer unlimited talk and text and 500 MB of EVDO data for $60 a month and unlimited talk, text and 2 GB of EVDO data for $70 a month.
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