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May 20, 2010

T-Mobile USA continues to make strong inroads in the prepaid wireless segment.

The wireless carrier now offers improvements in many of its prepaid packages that now include unlimited voice calling and reduced-cost text messaging features.

T-Mobile's decision is essential for the number four carrier in the U.S. which recently said it lost more than 76,950 wireless subscribers during the first quarter that included a loss of 118,000 postpaid customers that an unusually poor showing of only 41,000 prepaid net additions could not counter.

The new prepaid plans also slot in below T-Mobile's Even More offerings, which provide for unlimited talking and text messages for about $60 a month without a contract, but still offers a wider selection of mobile devices at unsubsidized prices or $70 a month for the same services but at a subsidized price.

T-Mobile's new plans provide for unlimited calling and messaging for $50 a month, or unlimited messaging for $15 a month and voice calls charged at 10 cents a minute.

The new unlimited voice and messaging services compete with similar plans from rivals Boost Mobile, Straight Talk, MetroPCS Communications and Leap Wireless' Cricket service, though those wireless carriers typically include unlimited data services and other features with their offerings.

The selection of mobile devices for the prepaid service is limited to just 4 basic models ranging between $20 and $40, none of which include a Qwerty keyboard.

The mobile service carrier does offer a prepaid SIM card for $7 that can used in any T-Mobile or unlocked device of the customer's choice.

William Ho, vice president of Current Analysis' consumer and small business group says "overall, T-Mobile USA desperately needed to make their prepaid portfolio more competitive in light of the multiple competitive prepaid unlimited offerings available in the market today."

"It's a very bumpy and winding road they're on to trying to capture a higher-ARPU unlimited calling customer while preserving margin and not cannibalizing the postpaid base," Ho added.

A fully-owned and managed subsidiary of German wireless giant Deutsche Telekom, T-Mobile USA continues to offer its traditional, pay-as-you-go service that begin at $10 for 30 minutes ranging up to $100 for 1,000 minutes.

However, text messaging on such plans is charged at 5 cents to receive and 10 cents to send.

But the package falls short of the value being offered by Sprint Nextel's recently unveiled Common Cents service that provides pay-as-you-go voice service at 7 cents per minute, with those minutes rounded down to the nearest minute, and text messages charged at 7 cents per message sent or received.

Last week, Verizon Wireless started offering free phone calls and instant messaging services to nine of its Android and BlackBerry smartphones as part of an exclusive deal with Skype. Wireless users of Verizon's service will be able to place free Skype-to-Skype calls and instant text messages, as well as low-cost calls to international wired lines and mobiles phones.

What's more, Verizon said that using the new service won't count against user's voice minutes or data plans with the wireless service provider.

Skype general manager Russ Shaw says "not so long ago, this was something that seemed very unlikely to the wireless industry. I mean, why on earth would a mobile service provider want to partner with a free service provider such as Skype?"

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Source: T-Mobile USA.