Kajeet, the kid-friendly MVNO, to kill consumer phone service next month

Kajeet's MVNO is no longer activating new accounts and will shut down the service next month.

Kajeet's consumer phone service is kaput.

The company's kid-focused MVNO has stopped activating new accounts and will kill service for existing customers on Aug. 23, it announced on its website. The company has struck a deal enabling customers to migrate to fellow MVNO TPO Mobile and activate service, receiving their first month for one cent.

Prepaid Phone News was among the first to report the news.

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“We are thankful to the thousands of devoted parents who chose our cell phone service to safely connect and communicate with their kids over the years,” Kajeet posted on its site. “We look forward to making a difference in the lives of schoolchildren for years to come.”

Kajeet executives told FierceWireless that the company will continue to offer its education-focused business, however. The company partners with more than 375 schools and districts to provide mobile broadband to low-income students.

Kajeet uses Sprint’s network and offered kid-friendly services for tweens and teens as well as controls for parents looking to monitor and limit their children’s mobile usage. In addition to phone plans, it offered a kid-centric mobile hotspot and an LTE transmitter designed specifically for school buses.

Kajeet was founded in 2003—several lifetimes ago in MVNO years—and it began to target the education market in 2001. It raised nearly $93 million in funding, according to Crunchbase, most recently drumming up more than $18 million in venture capital in 2011.

The history of MVNOs in the U.S. is strewn with failed businesses, of course, from high-profile brands such as Disney Mobile and Mobile ESPN in the early days of the market to smaller efforts such as For Defense Mobile and Scratch Wireless. More recently, RingPlus was shuttered after it failed to make a go of free, ad-supported calling plans.

The company said it was closing its consumer business to focus exclusively on its offerings for education.

Kajeet appeared to offer a sound value proposition for parents interested in making sure their youngsters stayed connected within specific confines. But the company may also have found it increasingly difficult to compete in a market where service providers have become largely focused on offering more and more data at the lowest possible price. And the market is likely to only become more competitive as cable companies continue to elbow their way into wireless.

The story was updated July 21 to clarify that while Kajeet is killing its consumer MVNO the company will stay in business and will focus exclusively on the education market. Also, Kajeet was founded in 2003, not 2011. FierceWireless regrets the errors.


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