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Virgin Mobile Test Marketing Five Months Free Service With Phone Purchase Offer

Virgin Mobile 5 Months Free

Virgin Mobile 5 Months Free Service
At an investor's conference last week, Sprint CEO Marcelo Claure said that the carrier will be putting more emphasis on its Boost Mobile and Virgin Mobile prepaid brands in 2017. I say it's about time, Sprint has lost prepaid users for the last six quarters in a row, shedding a total of 2 million prepaid customers since Q1, 2015. In the same period AT&T gained 3 million and T-Mobile gained 2.9 million prepaid customers.

According to Claure, Boost Mobile subscribers increased late last year, for the first time in many quarters. Claure said that Sprint will use Boost to compete directly with other carriers' prepaid brands and that Virgin Mobile will become Sprint's "disruptive" prepaid brand. 

Claure said that, as part of its disruptive strategy,  Virgin Mobile is test marketing a concept where instead of offering prepaid phones at subsidized prices as they do now, they are selling phones at full price but bundled with free airtime.

Wave7 Research's Jeffrey Moore spotted an example of Virgin's new strategy at a Best Buy store in Kansas last month. The store had prominent signage, as shown in the images above and below, offering customers five months free service in return for buying an LG X Power Android phone for $179.99. Jeffrey and I checked other Best Buy stores did not find any others with the offer.

The free service is on Virgin's $35/month plan that includes unlimited talk, text and data with the first 5 GB at high speeds. The airtime is worth $175 so you are basically getting the phone for $5. Virgin's regular full price for the X Power is for $149.99, although it's available for as little as $59.99 from online vendors.

Selling a phone bundled with airtime is not new, TracFone has been doing it for years with phone plus airtime bundles on HSN. T-Mobile Prepaid is also using the same model, giving customers a free Samsung Galaxy On5 if they buy $100 worth of airtime, 

I'm not sure I'd really call a phone with bundled airtime disruptive, but I suspect its been effective for TracFone or they wouldn't keep doing it. Virgin's phone bundled with airtime is a good deal if the Sprint network meets your needs. I'm sure the bundle will appeal to some customers but I doubt it's enough by itself to revitalize the Virgin Mobile brand. That will take advertising dollars and better plan pricing. Getting rid of Sprint's restrictions on BYOP and allowing any new or used Sprint network compatible phone on Virgin would help too.

Virgin Mobile 5 Months Free Service

Sources: FierceWireless, Wave7 Research. Images: Wave7 Research

33 comments:

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  1. I don't think this is going to disrupt a thing. Sprint is just beleaguered.

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  2. The only way Virgin can disrupt anything is to completely open up to Sprint's postpaid network. Otherwise, there is absolutely zero incentive to chose any Sprint Prepaid Brand.

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    Replies
    1. If they did that then what is the point of Sprint postpaid?

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    2. What you have just said is a complaint many Sprint pre-paid customers have, I use GoPhone but I got my SIM at the AT&T store so my APN is formatted to the main network.

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    3. Matt, with 'completely open up' are you including Verizon roaming? While that would be a game changer, I'm with Anon946--what would then be the point of getting postpaid?

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    4. With Verizon, AT&T, and T-Mobile there is already no point in going postpaid unless you need to go overseas.

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    5. There are currently more benefits to postpaid. EIP is the biggest one IMO. And I believe unlimited on AT&T and T-Mobile are available only on postpaid?

      Also, T-Mobile's native coverage isn't as good as the other two's. You would definitely lose out without supplementary AT&T coverage.

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  3. This is amazing. Hope it's nationwide!

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  4. Too bad VM plans are terrible. They don't offer unlimited unlike Boost

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    1. True, but not everyone wants or needs unlimited, especially if they have ample Wi-Fi. This may be very appealing for that group.

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    2. My family's uses in the 1.5 - 2.5GB a month range. So, this is effectively unlimited.

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  5. this will "disrupt" RingPlus

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    Replies
    1. and also "disrupt" Freedompoop! :)

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    2. And it might disrupt StinkPlus.

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  6. So, since we're paying "full price", the phone won't be locked to Sprint or Virgin, right? RIGHT?

    It's only a $5 phone if you pretend there aren't a dozen other MVNOs who offer cheaper service. And with Cricket/H2O/GoPhone/RedPocket and others at least as cheap, you'd be a fool to go with Virgin/Sprint. Boosts unlimited data plan is the only thing worth a look, and since I was on Boost the last time they suddenly discontinued unlimited data (2.5gb cap) for all their customers, I wouldn't trust them, anyhow.

    Run! Run far in the other direction. Run until Sprint (and TMo) realize their lousy coverage is only acceptable if it costs half as much as the big two national providers, who are inexpensive these days.

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    Replies
    1. Tom, I see your sarcasm regarding locking a paid-in-full phone. But unfortunately carriers are free to require "reasonable time, payment or usage requirements" on prepaid. And since this is not a law but an industry guideline (a total farce, IMO) "reasonable" can mean anything. Hell T-Mobile even requires 40 days on postpaid for paid off phones!

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  7. Bet this is only for new accounts and the phone/service can't be transferred to another line. I was supposed to get 3 months credit when I bought my Galaxy S3 years and years ago but every time I called CS about it that acted like the promo never existed...

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    Replies
    1. You are correct. A new activation is required for the 5 months free offer.

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  8. Sprint honestly is dead last for a reason. The ONLY way to save this disaster of a carrier is a merger with Tmobile and complete removal of the cancer tgat is Sprint management rot. Without Legere the new entity would jyst be a straw giant that Att and Verizon would eat alive.It would also completely dusrupt prepaid wireless as we know it probably for the worse.

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    Replies
    1. Mergers limit consumer choice and rarely benefit customers.

      Legere is an act. Look at T-Mobile now charging Verizon rates without Verizon coverage. So any disruption that comes WILL be for the worse.

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    2. To say that T-Mobile is charging the same rates as Verizon Wireless is a significant exaggeration.

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    3. 2GB on Verizon: $55 (35+20)
      2GB on T-Mobile: $65 or 60 (75 or 70-10)

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  9. The biggest problem with Sprint Pre-paid Brand Boost Mobile and Virgin Mobile is BYOP (Bring Your Own Phone). Sprint continues to block new customers for coming. Sprint even Block their Own Phone

    The Sprint Grocery Store.
    In the meat Department only take MasterCard,
    In the Deli Department only take Visa,
    In the produce Department only take Check, and
    In the Grocery Department only take Cash.

    How long would keep going to that store?

    Until BYOP is fixed no deal would ever bring customer back

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    1. IMO too much is made of BYOP as a reason. First, it's too expensive if you're looking at the flagship-end phones. Second, carriers WANT commitment as this article shows, so true BYOP gets throttled unless you go with Apple or maybe Samsung. Which OEM sells a ton of phones and more of them through their non-carrier channels than carriers? I would venture to say not even Apple. So if you don't have the market presence of an Apple or a Samsung, you get terms dictated to you. Terms such as "disable band 12," or "don't make voLTE available on the unlocked model," or "add our bloatware," etc.

      The US just isn't set up for true BYOP. For a lot of people $400 and above is too much to put down on phones. This is why contracts flourished and then the EIP system, which is still a contract.

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    2. Prepaid BYOP is primarily with used phones, not people buying new iPhone 7, Pixels and Galaxy S7 Edges.

      I believe that on carriers with less restrictive policies BYOP of hand me down and purchased used phones drives a significant number of activations. Selling and activating used phones is a major revenue source for many prepaid dealers.

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    3. You're right. I was on VM for about 7 years. At the end of 2015 I left because they weren't offering good enough phones and I couldn't BYOD. Went to Tracfone where I brought the phone of my choice AND get better coverage (Verizon) AND pay less money. But if I hadn't been so restricted in devices Sprint would still be getting my monthly fee.

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  10. Here's the secret about Flagship -end phones. Buy Apple or Galaxy phones 2 to 3 year-old as new. You get quality at a great price or you can buy from friends upgrading.

    The Big problem with Sprint is BYOP. If I see a deal I like from Virgin mobile and I have a Boost mobile I cannot get it because I have Boost Mobile. As a result the customer leaves.

    Customer life changes, what a customer need a year ago is different than today. Until Sprint realizes that, Sprint will continue to lose customers.

    How many Customers would buy 2 Flagship -end phones? One for Boost Mobile and one for Virgin Mobile to be use on the same network.

    That’s The Problem with Sprint

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  11. If you're buying the phone at "full price" are they unlocked devices. What unlock policy will apply to these phones?

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    1. You aren't really buying the phone at full price as it comes with 5 months free service worth $175. I'm sure the standard 12 months service requirement for unlocking will apply.

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    2. "The airtime is worth $175 so you are basically getting the phone for $5"

      Are you really buying the phone for $5 or is it five months of service that is bundled in for $5?

      Regardless, payoff status isn't the only requirement looked at when requesting an unlock. You could buy the phone for $150 and they wouldn't unlock it until all ridiculous policies are fulfilled. I guess we're supposed to be grateful they/Sprint even agreed to the CTIA guidelines.

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  12. The benefits of byop has pros and cons. A boost mobile or Virgin phone on the open market is way less of value then any gsm phone whether locked or not for the simple reason that the limitations and terms are much more strict and proprietary giving the owner of the Sprint/Boost/Virgin phone less options and more headaches. BYOP is and never was a true focus of the US market. It was just that half the people here are on gsm and with the big handset twins Samsung and Apple asserting more control on concepts like "universal phones", they are trying to reduce the traditional carrier reliance that handset makers face in the US, a problem less overt in other parts of the world where the technology is predominantly gsm based like the EU, much of Africa, South America an Asia. In the US, smaller carriers, cdma and gsm used their lower priced plans to get users on bigger carriers to bring their own devices killing two birds with one stone. The smaller carrier gets a new customer without having to try and get a top of the line handset and they get a competitor's customer at the same time. With prices at an all time low, there is no more room for the regionals and mvnos (which are at the mercy of their big four parent carriers anyway) so byod is still important but has lessened. Another factor in prepaid that has lessened the power of byod except for top of the line phones is the continuing on again/off again Boost/Metro/Cricket three way prepaid war which in many markets has been flooded with cheap, new Androids . The Gsm ones especially make the allure of older byod handsets less attractive. New usually gets more attention then old. That breaks down byod into several markets. People who want to keep their top of the line flagship on a better plan, people who want to try all kinds of phones on their better plan, people who want to activate something that's been laying around in their drawer, people who come from outside the US and want to continue using the phone they bought overseas. Byod will always continue to exist changing and adapting with the laws, restrictions, freedoms , policies and trends of the times but it will never just be stagnant.

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  13. Wave7 reported this week. “Boost has been broadly experimenting with comparable trials involving 2-3 free months.”

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