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Virgin Mobile Heats Up Prepaid Mobile Broadband Wars

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In a bid to grab new customers, Sprint’s (s s) Virgin Mobile USA has reduced the price of its highest capacity prepaid unlimited mobile broadband service to $40 per month with no contract. That compares favorably to Verizon’s (s vz) new prepaid plan at twice the price with a 5 GB limit over 30 days. Along with the price reduction, Virgin Mobile USA is retaining its $10 plan that provides 100 MB of mobile data over the course of 10 days.

Sprint’s main CDMA competitor, Verizon, has offered prepaid mobile data since November of last year, but the pricing is much higher than that of postpaid plans as the carrier would rather lock consumers into a two-year contract. Verizon, too, just modified its prepaid mobile data plans today, with the smallest plan boosted to 100 MB. You’ll need to use it up quickly however, because for $15, it only lasts for a day. And when Fierce Wireless caught wind of a potential new 5 GB plan last night, I confirmed it on the Verizon site today: The new prepaid plan currently costs $80 for a month of data, or double the new Virgin Mobile USA offering.

Compared to the $60 per month that I currently pay Verizon Wireless for service on my MiFi, the new Virgin Mobile USA plans are a steal. The benefit that may entice other consumers is the lack of a contract; while you have to purchase a $150 MiFi or $80 data stick up front from Virgin Mobile USA, you don’t have to pay for data when you don’t need it. Luckily, I’m long past my contract date and on a month-to-month plan, so I don’t have to fear a hefty early-termination fee.

Aside from consumers winning with a another cheap mobile broadband choice, Sprint has much to gain through the cheaper Virgin Mobile USA mobile broadband plan if it attracts customers. The carrier purchased Virgin Mobile USA in July of 2009 for $483 million, and the prepaid brand has brought Sprint needed cash as both its ARPU and number of subscribers have been declining. In the most recent quarter, Sprint did grow its subscriber base for the first time in three years, but still reported a net loss of $760 million.

Related research on GigaOM Pro (sub. req’d):

What Happens When Data-Friendly Phones Come To Prepaid?

12 Responses to “Virgin Mobile Heats Up Prepaid Mobile Broadband Wars”

  1. as of 2/15/2011 virgin mobil changing $40 per month plan if you want to skip a $40 a month now you can after feb you have to use 40 every month plan or if you do not it will go to 50 per month. when you calll virgin we had to call 3 times to get the real story

  2. VM dropped the 300mb ($20) 30-day option with no warning. This was my preferred option and as a registered customer – you might think they could have sent me a notice. I often did not use the full 300 mb, but for $20 I could tolerate the variable connection glitches. The $40 for unlimited is not a great deal for me. Why it is so impossible to get decent customer service?

  3. I got the Virgin Mobile $25./mo for 300 anytime mins. and unlimited data/messaging. It has been a true nightmare from the first. I cannot get on the net half the time and their customer service is really customer abuse. If you talk to them, e-mail them or whatever, they are all apologetic, give you a reference # and that’s the last bit of effort expended on the problem. It seems to me, based on my experience, that VM isn’t providing service for the money, so I’m not saving a thing and VM gets a little unearned income. I don’t know how they legally do it. I’m angry and frustrated with them and would NEVER recommend them to anyone.

  4. Pfft! Forget all these plans. Just give me Clear Wireless access in my town. unlimited 4G broadband internet service for 40 a month? Yes please. It’s like having the cable net service you do now without the wire. The whole city becomes a wi-fi hotspot.

  5. jalapeno

    Looks like the data plan wars are heating up, this weekend in the Best Buy circular they were offering a “Best Buy exclusive” Sprint data plan for $29.99 a month with 2GB data limit, if purchased with the HP Pavilion dv5-2074dx Laptop with 3G gobi card.

  6. Actually, there are two decent plans: T-Mobile’s $40 plan (available without contract) and this plan.

    T-Mobile might be faster (HSPA+ vs EVDO), but Virgin definitely has better coverage. T-Mobile can be a bit cheaper (since if you buy the VM fill-up cards in a store you have to pay sales tax).

    T-Mobile currently has no MiFi device (although you can get 3rd party devices to make a 3G-modemFi), and if you go more than two months without service, you have to pay the $35 activation fee to reactivate.

    I’m currently on the T-Mobile plan, like it (since my 3G reception is normally good, and I don’t need a MiFi), and don’t plan on switching. I tried the Virgin Mobile service about a year ago, and was happy with the service, but at the time the price was too high for my usage.

    • I’m not sure T-Mobile’s $40 plan is a very good deal. Voice is expensive at 45 cents a minute and you pay $40/month even if you don’t use the service. Perhaps the biggest flaw is T-Mobile “newspeak” for “unlimited”: in this case in the fine print T-mobile defines unlimited as web browsing and e-mail. Any other usage such as P2P or direct downloads violates the TOS.

      What attracts me to Virgin Mobile offering is that it appears to be true unlimited data as well as pay-as-you-go, not prepaid as Kevin states in his post. (“Prepaid” is applied in so many ways by the carriers that it has lost much of its meaning.) For me, PAYGO means only paying for services you actual use when you actually use them.

      I’m going to sign-up and pair a MiFi with a WiFi capable smartphone using T-Mobile’s ToGo voice service. I’ll stock up the MiFi only when needed, which won’t be very often.

      • For your use, Virgin Mobile does seem to be a better fit.

        I wouldn’t be surprised if Virgin Mobile has some soft caps — Sprint in the past has kicked people off who abuse “unlimited” service (but IIRC at least they don’t charge for overages or ETF).

        To some extent even with “Pay as you go” you pay even when you don’t use the service — after you spend $40, you’ve paid for the next 30 days whether you need it or not. With T-Mobile Even More Plus, you can sign up one month, cancel for two months, then pay again without extra fees (yes, this is a bigger hassle than PAYGO).