Walmart exec: TracFone's Straight Talk is 'one of the best-kept secrets' in wireless
LAS VEGAS--Walmart's top mobile executive said that the Straight Talk service offered by América Móvil's U.S. MVNO, TracFone Wireless, is the fastest growing part of its sprawling mobile business.
"Straight Talk has been an incredible value for our customers," Gibu Thomas, global head of mobile at Walmart, said in an interview with FierceWireless here at the CTIA Wireless 2013 conference. "It's the fastest growing segment of our wireless business." Walmart in January launched Apple's (NASDAQ:AAPL) iPhone, including the LTE-capable iPhone 5, coupled with a $45 plan for unlimited voice, texting and data.
Although he declined to provide sales statistics, Thomas said Straight Talk has a mass market appeal that is undeniable. "I think it's an incredible value for anyone," he said. "I think it's one of the best-kept secrets."
In related news, TracFone said it will set up retail stores that exclusively sell its prepaid brands, according to a Twice report. The report, citing comments from Tim Garrett, the company's regional senior vice president for indirect-channel marketing, said TracFone is working with master agents to launch the stores, which will be owned and operated by independent parties and run under the name Simple Mobile Solutions. TracFone acquired T-Mobile US' (NYSE:TMUS) MVNO Simple Mobile last year, where Garrett was an executive.
The report said TracFone launched five stores in New York City and five in Miami in the past month, and plans to launch up to 30 more by the end of the year and expand beyond that in 2014. The stores will sell the TracFone, Telcel America, Simple Mobile, Net10 and SafeLink Wireless brands. Straight Talk will continue to be offered exclusively though Walmart.
TracFone is by far the largest MVNO in the United States and offers service through Verizon Wireless (NYSE:VZ), AT&T Mobility (NYSE:T), Sprint Nextel (NYSE:S) and T-Mobile US' networks. TracFone ended the first quarter with 23.2 million customers, a customer base that is 15.4 percent bigger than a year ago. Earlier this week TracFone acquired Start Wireless' Page Plus Cellular, an MVNO that counts around 1.4 million customers in the United States.
Straight Talk is just one of a number of wireless brands in Walmart. The retailer offers postpaid service from all four Tier 1 carriers as well as prepaid service from Net10, Sprint's Boost Mobile and Virgin Mobile, Cricket provider Leap Wireless (NASDAQ:LEAP) and Walmart's own "Family Mobile," which uses T-Mobile's network.
Thomas said Walmart will continue to provide a range of wireless offerings. "Our focus in wireless is we want to provide a broad assortment," he said. "It's really about giving a portfolio of services for our customers."
In other Walmart efforts, Thomas said the retailer will continue to use mobile apps to improve shoppers' experience. He said Walmart recently launched the ability to send its weekly circular with coupons to customers via mobile, which helps customers save money and time if they forget coupons.
However, Thomas said there is more Walmart wants to do, including sending automatic product suggestions to people based on their buying habits and dietary restrictions. He said that Walmart is conscious of consumer privacy concerns with features like that. "We'll have to figure out where the right privacy balance is," he said. "Our philosophy is test and learn."
Thomas also said at this point, based on what Walmart has observed, customers are not ready to fully pay for goods via their mobile phones, whether that's through Near Field Communications or any other technology. Any solution along those lines needs to produce easily understood benefits and "provide immediate value" for consumers.
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