LAS VEGAS--AT&T Mobility's (NYSE: T) Cricket Wireless prepaid brand plans to shut down its Muve Music service on Feb. 7, and starting Jan. 31 will replace it with the Deezer music service, which will be available to Cricket subscribers for $6 per month, taxes and fees included.
Separately, the carrier announced it will start shutting down its legacy CDMA network March 15, and will complete the process by Sept. 15.
Jennifer Van Buskirk, president of Cricket, said that Muve had "run its course." The music downloading service was originally introduced by regional prepaid operator Leap Wireless in 2011, and was available to customers who were on the carrier's more expensive rate plans. AT&T acquired Leap last year, and since then the fate of Muve has been up in the air.
It's unclear how many Muve customers Cricket currently has. The company declined to provide subscriber numbers. Prior to AT&T's acquisition of Leap, the company said last year in a Securities and Exchange Commission filing that Muve Music was available to more than 2.3 million Cricket customers as of the end of 2013, "and is currently among the largest on-demand music subscription services in the U.S. as measured by the number of paid users." TechCrunch noted Muve had about 2 million users.
Cricket said Deezer's service will provide both streaming and downloading options for music (Muve just provided downloading options), and Cricket customers can try out the service for 15 days for free before subscribing to it. Current Muve customers will be able to use Deezer without any additional costs through March. Thereafter, they will have to pay the $6 per month fee. Van Buskirk pointed out that, for customers on Cricket's $35 per month plans, the addition of Deezer will actually cost less per month than Muve Music did.
Deezer is available in a number of countries and counts 16 million users, 6 million of which are paying customers. The company's agreement with Cricket is its first mobile deal in the United States after entering the U.S. market in September. Similar streaming and downloading services are available in the United States from Spotify and other providers, but those typically cost $10 per month. Deezer offers a library of 35 million songs, larger than the 20 million offered by Muve Music.
Importantly, Van Buskirk said that current Muve customers who chose to sign up for Deezer will be able to move all their preferences--including playlists and favorites--from Muve to Deezer. Deezer will work on Cricket's Android and iOS phones.
Leap said in 2013 that it had inked a licensing agreement to provide Muve Music to TIM Celular S.A. in Brazil. However, Van Buskirk said that deal has been scrapped. She said Deezer has acquired some of Muve's employees and intellectual property. TechCrunch reported that Deezer paid under $100 million for Muve's employees and IP. Deezer previously purchased podcasting service Stitcher.
In other Cricket news, Van Buskirk said that the company plans to start shutting down its legacy CDMA network starting March 15. AT&T has already refarmed a significant amount of Leap's unused spectrum, and the market shutdowns will allow AT&T to refarm the rest of Leap's spectrum. Initial markets that will be shut down include locations in Arkansas, Illinois, New Jersey, New York and elsewhere. AT&T said it will completely shut down Leap Wireless' legacy CDMA network shutdown by Sept. 15. Click here for details on Cricket's network shutdown plans.
"People are migrating (from Leap's legacy CDMA network to AT&T's GSM-based network) at a very fast clip," Van Buskirk said, noting the migration rate has been faster than AT&T expected.
AT&T relaunched the Cricket prepaid brand eight months ago, and Van Buskirk said that "we've gotten a ton of momentum so far." She declined to say how many Cricket customers AT&T has, but said the number is larger than when AT&T completed its acquisition of Leap and the number of Cricket subscribers has been growing every month since the AT&T relaunch of the Cricket brand.
As for Cricket distribution, Van Buskirk said that Cricket now counts 3,200 Cricket-exclusive, dealer-owned stores, and she said the company plans to continue working to expand that number. She said AT&T opened 700 new Cricket-owned stores in 2014.
As for devices, Van Buskirk said Cricket this week launched the ZTE Grand X Max+ Android phablet for $199. She said the carrier offered a tablet under the now-shuttered Aio Wireless brand, but she said the tablet didn't sell well and instead Cricket plans to focus its energies on phablets and smartphones.
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Article updated Jan. 13 to correct information on the number of Cricket's stores.