Another Prepaid Carrier Wants to Jump on the Apple Bandwagon
MetroPCS may be the next prepaid wireless service provider to begin offering Apple’s (NASDAQ:AAPL) iPhone. MetroPCS is owned by T-Mobile (NYSE:TMUS), the U.S.’s fourth-largest carrier, which only began carrying the iPhone in April. T-Mobile was the last of the four major carriers to offer the iPhone, after AT&T (NYSE:T), Verizon (NYSE:VZ), and Sprint (NYSE:S). T-Mobile Chief Marketing Officer Mike Sievert suggested the possibility of carrying the iPhone through the MetroPCS brand in a recent interview with Re/code.
“We are very interested in that,” Sievert told the publication. “We think the Metro PCS customer would be as well.” Although Apple has traditionally partnered with wireless carriers that subsidize the relatively high cost of an iPhone with a standard two-year service contract, the growth of contract-free smartphone sales has led the Cupertino, California-based company to expand to several prepaid carriers over the past year.
Sprint subsidiary Virgin Mobile began carrying the iPhone in June, followed by contract-free carriers Straight Talk Wireless and NET10 Wireless. Straight Talk Wireless and NET10 Wireless began carrying Apple’s iPhone 5S and iPhone 5C through Walmart (NYSE:WMT) stores on Friday, December 13, according to a press release. Both carriers are brands of prepaid wireless provider and América Móvil (NYSE:AMX)(NASDAQ:AMOV) subsidiary TracFone Wireless. TracFone Wireless is America’s largest no-contract cellular service provider, with 23 million users.
Like many other no-contract carriers, MetroPCS is a fast-growing brand with more than 1.5 million subscribers, according to data cited by Apple Insider. In the first quarter of 2014, MetroPCS added another 465,000 prepaid customers.
As noted by Re/code, T-Mobile also expanded the MetroPCS brand to 30 additional markets after it acquired the company last year. Meanwhile, MetroPCS has been transitioning from its legacy CDMA-based network to T-Mobile’s GSM-based system. Besides aligning MetroPCS’s network technology with the new standard, the switch has also allowed T-Mobile to boost the performance of its own network by freeing up spectrum.
Although it remains to be seen if T-Mobile will follow through and add the iPhone to its prepaid MetroPCS brand, the move would likely benefit both companies. Apple would benefit from an expanded market for its primary mobile device product, while MetroPCS would likely attract new customers who may have previously avoided the network because of the unavailability of the iPhone.
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