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Apr. 8, 2009

MetroPCS reports first-quarter additions of more than 1.5 million wireless subscribers, representing an increase of 59 percent over the first quarter of last year.

MetroPCS’ results seem to reinforce the idea that more customers are switching to prepaid as a result of the ailing economy.

Analysts have been watching the prepaid market as consumers show signs of controlling their spending on wireless in a downward economy.

Traditionally seen as an option for consumers with weak credit or low income, the prepaid market has been forced to innovate to compete in a tougher economic environment. As a result, flat-rate prepaid is increasingly becoming a more mainstream option.

MetroPCS ended the first quarter of this year with about 6.1 million subscribers, which includes net additions during the quarter of about 684,000 subscribers, representing an increase of 51 percent over the first quarter of last year.

A New Millenium Research Council (NMRC) research brief released last month was one of the first indicators of a new trend towards penny pinching amongst mobile phone consumers.

Past surveys indicated that wireless users would rather cut back on entertainment, even groceries, before they would reduce spending on their wireless service.

In conjunction with its subscriber numbers, MetroPCS also launched Group-LINE, a one-call communication solution targeted at families and friends who are trying to save money by cutting the cord and replacing their landline phones with wireless phones.

The NMRC survey stated that no fewer than 40 million Americans, or 26 percent of consumers with contract-based cell phone service, are “more inclined today than six months ago to look at a way to save money on their mobile phone bills, such as switching to a prepaid cell phone service.”

The survey also demonstrated that if the economy worsened in the next six months, wireless consumers were likely to cut on some plan extras such as text messaging and some other data plans that offer more features.

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Source: NMRC.