AT&T Mobility (NYSE: T) will restrict the maximum download speeds available to its new Cricket prepaid customers to 8 Mbps on LTE devices and 4 Mbps on HSPA+ devices. The action is likely a way for AT&T to differentiate its AT&T-branded services from its Cricket-branded prepaid services, which now operate over the same network.
The caps on Cricket's speeds don't come as surprise; AT&T instituted similar speed caps on its Aio Wireless prepaid brand, which it folded into its Cricket brand earlier this week. AT&T closed on its $1.2 billion acquisition of Cricket prepaid provider Leap Wireless earlier this year, and yesterday it rebranded Cricket with new pricing plans and overhauled branding.
AT&T's new Cricket plans start at $40 per month for unlimited talking and texting and 500 MB of high-speed data, and range up to $60 per month for 5 GB of high-speed data. If customers travel over their data allotment, their speeds are slowed to 128 Kbps. Customers can also purchase additional high-speed data in 1 GB chunks for $10 each.
AT&T is working to transition Cricket's customers from Leap's aging CDMA network and onto AT&T's HSPA and LTE network. AT&T's caps on Cricket's peak download speeds are likely an effort to separate Cricket's plans from AT&T's own Mobile Share Value plans, which just like Cricket do not require a contract and support bring-your-own-device options. Speeds on AT&T's Mobile Share Value plans are not capped.
Interestingly, AT&T's revamped Cricket is AT&T's attempt to counter T-Mobile's (NYSE:TMUS) MetroPCS prepaid service. Like AT&T, T-Mobile acquired prepaid operator MetroPCS and is now working to transition Metro customers from that operator's aging CDMA and LTE network and onto T-Mobile's LTE and HSPA network.
T-Mobile doesn't cap the speeds available to its MetroPCS customers. However, it does prioritize its T-Mobile-branded traffic on its HSPA and LTE network over its MetroPCS traffic. "When the T-Mobile network is presented with competing demands, data associated with T-Mobile branded customers may take precedence over data associated with non-T-Mobile branded customers, including MetroPCS customers," MetroPCS notes in its terms of service. "Giving T-Mobile data precedence occurs only on a content-neutral basis, and its effect should be noticed rarely and temporarily, if at all."
T-Mobile employs a similar prioritization scheme on its GoSmart Mobile prepaid brand, which it launched prior to acquiring MetroPCS.
Sprint (NYSE: S) too recently announced network management practices aimed at mitigating customer data traffic. The carrier recently alerted its Sprint customers, as well as its Virgin Mobile and Boost Mobile prepaid customers, to its new data "prioritization management" program. The program "may manage prioritization of access to network resources in congested areas for customers within the top 5 percent of data users."
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