Clearwire Confirms New ‘Pay As You Go’ Service Is Coming

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Credit: Clearwire

Clearwire (NSDQ: CLWR) will be unveiling a new “pay as you go” service on Monday in a webcast for media and industry analysts, according to a document filed with the SEC today. Clearwire initially announced the webcast on Wednesday to disclose a new customer segment, but stopped short of saying it had to do with billing.

Typically with pay-as-you-go, consumers don’t have to commit to lengthy contracts and have the flexibility of using it one day or month, but not the next. The pay-as-you-go segment, which compares to the prepaid market, will be welcomed by some stiff competition. Just recently, Virgin Mobile (NYSE: VM) (owned by Sprint) rolled out a $40 unlimited monthly prepaid plan, which is half as much as what Verizon Wireless charges for prepaid mobile broadband, and about $20 less than what the carriers charge under a long-term contract.

Given that Sprint (NYSE: S) owns more than half of Clearwire, the plans being announced on Monday could be fairly aggressive and include both Clearwire’s 4G service and Sprint’s 3G. The call will begin at 8:30 a.m. Pacific and be hosted by Clearwire’s Chief Commercial Officer Mike Sievert.

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Vishi Gondi

Based on Bill Morrows comments sometime back, look for CLWR to target cable cutters. My prediction: $50/phone line with a BYO phone + $25/mo for broadband at home.

Clear CEO sometime back:
How would you describe the different markets that you (Clearwire, Sprint, Comcast) each address?
A Clear customer is often a cord-cutter. This customer has a mobile phone, but no fixed line phone in the house. He wants high-speed broadband, but he doesn’t want to be tethered to a fixed broadband service. People use Clear when they are in the house and when they are out on the go. They also probably don’t have cable TV service. Instead, they watch Hulu, YouTube, or other video sites for TV downloads.
The cable customer can’t cut his Internet connection at home. He might be sharing it with the entire family. But he wants to stay connected outside the house, so he keeps his cable subscription and bolts on the 4G wireless service onto a triple play package.
A Sprint customer really likes his smartphone. He is happy with the Sprint service. But he doesn’t want a separate bill from another carrier to upgrade to wireless broadband.
When you go into the market you see all these different customer segments and it’s easy to see that you can get more subscribers in total by marketing to different groups instead of just having one brand.

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