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Consumer Cellular: Still Going Strong When Other MVNOs Have Fizzled Out

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Surviving in the MVNO industry is not easy. MVNOs who had potential when they started out ended up shutting down their operations for a number of reasons. A more recent example is T-Mobile MVNO PTel Mobile, who quietly called it quits back in February early this year, after a decade and a half of business. Then last December, another T-Mobile MVNO, Solavei, closed its doors permanently after operating for about 4 years. After it had launched in 2012, Solavei declared bankruptcy a couple of years later. It eventually discontinued its service as of December 4, 2015.

There is one MVNO though that seems to be doing alright -- Consumer Cellular. Many consider Consumer Cellular as the second biggest MVNO today, second only to America Movil’s TracFone. John Marick, the chief executive officer and founder of Consumer Cellular, has recently revealed that the carrier closed the year 2015 with about 1,250 employees, 2.1 million customers, and revenues amounting to $609 million. Those numbers are quite an improvement over the 700 employees, 961,000 customers, and $263 million revenues the MVNO posted in 2012.

Competing against TracFone is certainly no walk in the park, but Consumer Cellular has reason to feel good about its chances. FierceWireless reported back in May earlier this year that TracFone seems to have plateaued at around 25 million customers. Consumer Cellular, on the other hand, is looking at continued growth for its operations. Marick predicts that two years from now, the MVNO will expand to 2,000 employees, 3.25 million customers, and revenues of $1 billion. It is doable, especially when one considers that Consumer Cellular has registered 30 percent growth year over year for the last ten years.

So how did Consumer Cellular pull it off? Simple -- by targeting a specific niche in the market: mobile users who are at least 50 years old. Why old people? Well, Marick and his team found in 2007 that the elderly demographic had the most traction when it comes to mobile use. It certainly helped that around that time, the MVNO signed a revenue-sharing partnership agreement with the American Association of Retired Persons (AARP), basically allowing the Consumer Cellular to promote its services to AARP members. After deciding to specifically target the 50-plus market, Consumer Cellular then made an effort to deliver its mobile services in the simplest way possible. For instance, it continues to partner with Doro (a phone maker from Sweden) in producing custom feature handsets that can easily and readily be used by senior citizens.

Of course, despite its success, Consumer Cellular is still facing some hurdles looming on the horizon. To continue to survive in a wireless industry ruled by the Big Four (Verizon Wireless, AT&T, T-Mobile, and Sprint), Consumer Cellular will still need to try to keep pace with the pricing and special deals offered by the bigger mobile operators. And as wireless technology continues to evolve, Consumer Cellular will need to be ready to adapt to any new tech, too, if necessary. But so far, sticking to basics has produced impressive results for the MVNO.


Source: Fierce Wireless

27 comments:

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  1. Nothing in this article is news!

    What was even the point of writing this?

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    1. The facts merit documentation. CC hasn't' been mentioned much here.

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    2. I consider Consumer's customer counts, revenue numbers and growth rate to be newsworthy. As is the fact they have made a success out of catering to a niche market rather than being just another MVNO competing solely on price as most do.

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    3. So many critics in this website who point out the negative. I'm glad they posted these news. I didn't know Consumer Cellular was doing that well. Thank you Christine for your time putting this together.

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    4. Christine's editorial license is sometimes too "right from the press release". But in this case, she has good reasons to use superlatives and make judgements.

      Well written!

      It is worthwhile to know about this in the post PTEL, post InDefense-able era.

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    5. Consumer Cellular has great customer service and in the MVNO world this is pretty rare. My elderly father in law uses the Doro phone needed a new one. When I called CS for him it was like talking to Verizon CS. The new phone was ordered and mailed without a long delay. And I could understand every word clearly from their CS rep. I'm on Total Wireless for myself and wish their CS was as good as Consumer Cellular. Thanks, Christine, for the good article on a well run MVNO.

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  2. I don't mind reading a success story. What was the point of your comment? Perhaps some of us prefer a solid service provider that won't suddenly go out of business.

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  3. Very informative Christine,thank you.

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  4. I'm surprised about CC's success too. Their rates aren't at all competitive. Even for an AT&T MVNO. GoPhone or Cricket would serve seniors just as well and they aren't going anywhere anytime soon.

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    1. I think it's more about brand loyalty than anything else. Seniors are very loyal customers more so than the average prepaid subscriber who hops to the new company or plan that offers more data for less money. My mom will not move out of AT&T just because that's the company my late dad had signed her up for. She could be saving a lot more with prepaid but she's loyal to that company because my dad chose it. Catering to a specific demographic/age group is very smart business.

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  5. Thanks for the article, Christine. Years ago, way before partnering with AARP, Consumer Cellular was selling their phones and service through AAA auto club, offering members an inexpensive way to have an emergency phone for use while on road trips. It's true their cell rates are not the cheapest but I sense CC's better-than-AM customer service is why their customers stay.

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  6. When your talking about 50 year olds, could we go easy on the "elderly" description? : )

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  7. being older this article was relevant to me and I'm glad it was written. I've wondered about this company and will now look into it more. Thanks to this site for putting this article here.

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  8. 50 is middle aged now days, even though 50 is a requirement to join AARP.
    Using 50 and old people as Christine did in the same sentence shows her lack of respect for those older and wiser than her. She may write a lot of articles but this one comes from the bottom of the bucket....perhaps it was a slow news week for her.

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    1. If you're offended, you should be upset at AARP and CC.

      Don't shoot the messenger.

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    2. Fifty is middle age if you're going to live to be 100! Sorry guys, but for those of you who are 40-something, your "middle age" already happened. :-)

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    3. Fifty odds middle age. It's not mathematically based. Nobody knows how long they are going to live anyway unless they are terminal and even then. Who cares about that anyway, enjoy life to the fullest regardless of how old you are. We're all will eventually get there. Don't sweat the small stuff.

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  9. CC also has off network AT&T roaming, which draws subscribers. I find its pricing to be competitive for two lines of low to moderate use as well.

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    1. I agree. And PC Mag awarded CC "Best Bargain Plan for Couples" recently, and then "The Best Cheap Cell Phone Plans You've Never Heard Of" this June.
      My wife and I pay $38/month total for all we need, and appreciate the plan flexibility and excellent customer service. Our daughter and her husband pay $50/month vs the $150 they were paying on Verizon, and couldn't be happier. Consumer Reports rated them the #1 carrier as well, in the last two surveys of 60k+ subscribers.

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    2. I don't have the plans for Gophone memorized, but the Cricket offerings are best for high data use, and poor for low use. CC competes very well in the low use area.

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    3. That's the key. Moderate use. The targeted base for Consumer Cellular doesn't use data like some younger users do.

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  10. Using 50 and old people as Christine did in the same sentence shows her lack of respect for those older and wiser than her. She may write a lot of articles but this one comes from the bottom of the bucket....perhaps it was a slow news week for her.

    Someone is having a bad day - and they should apologize. This article is a significant improvement on the Fierce Wireless article. She took their article, did further research, and produced a quality product.

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    1. Actually if your speaking of the August 5th article written by Mike Dano, I wouldn't call this article a significant improvement over his especially if she used any parts of his article to write hers as you stated.

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  11. tl;dr it's a straight up puff piece press release

    "Consumer Cellular will still need to try to keep pace with the pricing and special deals offered by the bigger mobile operators. And as wireless technology continues to evolve, Consumer Cellular will need to be ready to adapt to any new tech, too, if necessary."

    No shit.

    "But so far, sticking to basics has produced impressive results for the MVNO."

    In other words, they're still not going to compete on the same level as the MVNOs that actually get talked about.

    Wow, this turned out to be nothing.

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  12. my gramps and grandma watch old tv shows and old movies on those secondary channels on over-the-air antenna tv. no cable tv. just antenna tv. every other commercial is for consumer cellular. just old gray hair people in those commercials. so funny when talk to my gramps if he and grandma would switch when i asked when i was visiting and watching tv with him. he said might as well call it old gray hair cellular. my gramps is bald and grandma dyes her hair. they would never use consumer cellular. haha even they are old they don't want to be like those gray hair people in the commercials. no gray hair cellular for them. but haha they rather stay on their cheapie tracfone flip phones.

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  13. my parents like consumer cellular due to the awesome customer service and flexible plans. You can downgrade when you go on vacation, and upgrade when you come back.

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  14. The other sweet spot for Consumer Cellular is active outdoor users needing full ATT roaming partner coverage across the western US. For a family of four with moderate usage no other plan comes close. GoPhone coverage ends long before you get to the starting line of a mountain bike or kayak trip.

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