FreedomPop is partnering with Dish to offer free mobile services in Mexico in a model it hopes to duplicate in other markets.
The MVNO formed a joint venture with Dish Mexico, which is owned by Dish and MVS Comunicaciones, to provide free voice, data and text services to consumers. FreedomPop will run the operational aspects and power the service while Dish will provide distribution, customer service and “local expertise.” Dish will also provide an undisclosed amount of capital to get the effort off the ground.
“We chose FreedomPop as our strategic partner in Mexico because our main objective is to constantly deliver consumer value and we have seen the company do this in other countries so the model is proven,” said Ernesto Vargas-Guajardo, CEO and director of MVS Comunicaciones, in prepared remarks. “We’re excited to have the world’s most innovative and customer-centric mobile provider as a partner.”
FreedomPop said the model will serve as a blueprint for deals slated to launch next year in Germany, Italy, Australia and undisclosed Asian markets. The company didn’t reveal any other partners.
FreedomPop uses Sprint’s network in the U.S. and offers a free plan that includes 500 MB of data, 200 minutes of voice and 500 texts per month. The company has expanded into the U.K. and Spain in the last year, and has raised more than $109 million in financing including a $50 million Series C Round announced early this year.
The Los Angeles-based outfit uses a freemium model to entice users, then upsells them into bigger packages or other value-added services such as additional local numbers for users in foreign lands or a “safety mode” that prevents overage charges. It sells handsets as well as SIM cards enabling customers to activate their own phones.
Several weeks ago FreedomPop began offering zero-rated data from WhatsApp, enabling users to send texts, videos and other content without incurring data charges. While the companies don’t have a formal relationship, the MVNO positions the offering as a way for consumers to access mobile data without also paying for voice and text services.
The Dish arrangement indicates FreedomPop hopes to score similar arrangements with high-profile partners in other markets in an effort to score capital and minimize costs. While 52 percent of its 1 million subscribers worldwide pay FreedomPop nothing, the service provider clearly believes it can build a lucrative business from a minority of users who pay for value-added features.
“We know everyone in the world would love free voice, data and text and with our partnership with Dish Mexico and the upcoming four other international joint ventures, we are exponentially increasing our progress in making free mobile services a reality for everyone,” said Stephen Stokols, CEO and co-founder, FreedomPop, in a press release.
FreedomPop said its service will launch commercially in Mexico in the next few months; customers can apply for a beta offering starting today.
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