Krishna Baidya’s Random Musings

Posts Tagged ‘Pre-Paid

T-Mobile USA has launched a new unlimited mobile plan available to customers outside of a contract in a bid to compete with prepaid rivals such as Leap Wireless and MetroPCS.  The new plan will offer unlimited talk, text and Web surfing for US$79.99 a month to customers who do not want to sign up for a long-term contract, which typically lasts 2 years. Earlier this year (March) it started offering ” Unlimited Loyalty Plan”, unlimited minutes on an individual line for $49.99/ month and unlimited minutes on a two-line Family plan for $89.99/ month, to its customer who have been with the carrier for at least 22 months with a reliable payment history. Now, the company is believed to extend the $50/ month unlimited service for non-contract customers. The new deal represents a 20 percent discount on T-Mobile’s standard unlimited monthly fee for contract customers, though subscribers to the new deals will be required to pay a higher fee for a handset.

The introduction of unlimited monthly prepaid plans in the US was pioneered by Sprint subsidiary Boost Mobile, which launched a US$50 monthly plan in January. The plan has since been replicated by a number of its prepaid rivals and has led to a fierce price war in the prepaid low-end segment.

This is quite a bid to attract customer to its network and will not be surprising the beginning of a price war. As a end user, I am not complaining. Other broader implication is more subtle (but non-avoidable in my opinion) where mobile carrier too is following suit of ISPs in becoming nothing but a dumb pipe. It will be interesting to see how long more other operators across the world can wait before forced to accept this very fact.

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Singapore’s Starhub has reported that its second-quarter operating revenue was stable at S$532 million compared to S$531 million in Q2 2008. The Group’s EBITDA for the quarter rose 10% to S$161 million, and net profit after tax increased 21% to S$78 million.

Capital expenditure (capex) was S$24 million higher at S$70 million from a year ago.

Revenues for Fixed Network services and Mobile grew by 7% and 1% respectively. However, Pay TV and Broadband revenues contracted by 2% and 3% respectively. Mobile continues to be the major revenue contributor at 51%. Pay TV, Broadband, Fixed Network Services and Sales of Equipment contributed 19%, 11%, 15% and 4% respectively to the mix.

Mobile revenue grew 1% to S$272 million from S$269 million for the quarter. Post-paid mobile services revenue was 2% lower at S$208 million, accounting for 76% of the Mobile revenue mix. Pre-paid mobile services revenue rose 12% to S$64 million. Post-paid ARPU slipped S$8 to S$69, while pre-paid ARPU moved up S$3 to S$23. The lower post-paid ARPU was mainly attributable to decreases in voice IDD and outbound roaming usages.

“We are pleased with the results given the challenging business environment that we operate in. Our diversified revenue base has allowed us to mitigate the impact of softer demand due to the weakened economy in certain segments. Good cost containment has delivered excellent free cash flows with substantial headroom for sustaining our guidance on dividend payments,” said Mr Terry Clontz, CEO of StarHub. “However, as it is not clear whether we have yet seen the worst impact of the economic downturn on our business, we will remain diligent in looking for ways to control costs while pursuing
profitable growth.”