NEWS: Virgin Mobile USA Hits 1 million PrePaid Customers

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Virgin Mobile USA hits 1 million customers
Prepaid wireless service provider Virgin Mobile USA L.L.C. said it has
signed up more than 1 million net subscribers five quarters after launching
its mobile virtual network operator service using Sprint PCS' network July
24, 2002. Virgin Mobile USA noted the result matched the previous growth
record set by Sprint PCS as the fastest carrier to reach the 1
million-subscriber mark.

"One million customers represents an important first step in our quest to
become a significant long-term player in the mobile market," said Dan
Schulman, chief executive officer of Virgin Mobile USA. "Our attaining this
milestone is strong confirmation that we are moving in the right direction
and that we have developed a successful formula for addressing the evolving
needs and tastes of American youth."

Virgin Group Chairman Sir Richard Branson added that the company's U.K.
operations recently reported 3 million subscribers in less than four years
and that he had higher expectations for Virgin Mobile USA.

As part of the growth announcement, Virgin Mobile USA L.L.C. noted customers
have sent and received nearly 150 million text messages since the beginning
of this year, 70 percent of its customer base is under the age of 30, and 40
percent of subscribers use its non-voice services.

Virgin Mobile USA also launched its first MTV-branded wireless handset,
which is based on Kyocera Corp.'s Slider model. RCR Wireless News first
reported details of the MTV-branded phone last month. The Slider v5MTV
Edition handset includes access to exclusive MTV content, including screen
savers, ring tones and music news and carries a $159 retail price.
SOURCE http://www.rcrnews.com/cgi-bin/news.pl?newsId=15758

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› See More: NEWS: Virgin Mobile USA Hits 1 million PrePaid Customers

In Exchange for turning over its Prepaid business to Virgin, Sprint was paid
$50 million, and now receives no ongoing revenue from Virgin.

http://www3.sprint.com/PR/CDA/PR_CDA...1,6240,00.html

To correct you, this is a "joint venture" which essentially makes this a
partnership. Sprint will benefit (or lose) in equal proportions with
Branson.

scannell
cols. oh

"CAT0NHAT" <[email protected]> wrote in message
news:[email protected]...
> In Exchange for turning over its Prepaid business to Virgin, Sprint was
paid
> $50 million, and now receives no ongoing revenue from Virgin.
>
>
http://www3.sprint.com/PR/CDA/PR_CDA...1,6240,00.html

Um, Virgin mobile is a 50/50 venture between Sprint PCS and Virgin
Records...

If it was 100% Virgin, would you think the stores would be selling the
phones?

--
Posted at SprintUsers.com - Your place for everything Sprint PCS
Free wireless access @ www.SprintUsers.com/wap

If you are responding to me, that is what I already said.

scannell
cols. oh

"TechGeek" <[email protected]> wrote in message
news:[email protected]...
>
> Um, Virgin mobile is a 50/50 venture between Sprint PCS and Virgin
> Records...
>
> If it was 100% Virgin, would you think the stores would be selling the
> phones?
>
> --
> Posted at SprintUsers.com - Your place for everything Sprint PCS
> Free wireless access @ www.SprintUsers.com/wap
>

scannell wrote:
> *If you are responding to me, that is what I already said.
>
> scannell
> cols. oh
>
> *

Nope, it was an agreement to what you said directed at the orig poster.

--
Posted at SprintUsers.com - Your place for everything Sprint PCS
Free wireless access @ www.SprintUsers.com/wap

TechGeek wrote:

>Nope, it was an agreement to what you said directed at the orig poster.

Either the web interface at sprintusers.com sucks, or you don't know how to
respond to followups properly. Can't tell which.

"PDA Man" <[email protected]> wrote in message news:<[email protected]>...

> Virgin Mobile USA hits 1 million customers
> Prepaid wireless service provider Virgin Mobile USA L.L.C. said it has
> signed up more than 1 million net subscribers five quarters after launching
> its mobile virtual network operator service using Sprint PCS' network July
> 24, 2002...

...."and nearly twelve of them are over 16 years old, sources at Virgin explained..."

"Todd Allcock" <[email protected]> wrote in message
news:[email protected]...
> "PDA Man" <[email protected]> wrote in message
news:<[email protected]>...
>
> > Virgin Mobile USA hits 1 million customers
> > Prepaid wireless service provider Virgin Mobile USA L.L.C. said it has
> > signed up more than 1 million net subscribers five quarters after
launching
> > its mobile virtual network operator service using Sprint PCS' network
July
> > 24, 2002...
>
> ..."and nearly twelve of them are over 16 years old, sources at Virgin
explained..."

I still can't fathom what basses of the hatred toward prepaid cellular
phones is.

"They are just child toys... bla bla bla......."

Some analyst point out that the ARPU is lower, so they must be the "credit
challenged"
And since the ARPU is lower, that can't be any good for the company.

FU*& the ARPU.

The reason it's lower is because they don't offer any prepaid plans that
are useable to the heavy users.
That is the company's fault, not the user's fault.

And the company doesn't have as much overhead with
prepaid customers because they don't have subsidies to shove out.
So that means the company makes more profit from them
even though they have a lower ARPU.
It's the profit per user and not the dang ARPU that counts.
But that is something that most analyst are too stupid to comprehend.

Another thing they are two stupid to understand is profit per network
utilization.

If you earn $20 per month at a profit of $15 per month from a prepaid
customer
and you can support 1000 users per a chunk of spectrum in a market.
It will be far more profitable than 1000 users that earn you 60 dollars
each a month.
Because they talk ten times a much and only earn you four times the money.

And the only other thing I can think of is the fact that companies can't get
them under contract.
But that is something that people should hold them in high regard for,
Because they are not stupid enough to get themselves rapped up
in a dang two year contract.

They can take there fu#&ing contracts and shove them up their a$$.

.......(rant off)...........
Ahh... It felt good to get that off my shoulders. :-P

...... (EDIT)..........

If you earn $20 per month at a profit of $15 per month from a prepaid
customer
and you can support 10000 users per a chunk of spectrum in a market.
It will be far more profitable than 1000 users that earn you 60 dollars
each a month.

"N9WOS" <[email protected]> wrote in message news:<[email protected]>...
> "Todd Allcock" <[email protected]> wrote in message
> news:[email protected]...
> > "PDA Man" <[email protected]> wrote in message
> news:<[email protected]>...
> >
> > > Virgin Mobile USA hits 1 million customers
> > > Prepaid wireless service provider Virgin Mobile USA L.L.C. said it has
> > > signed up more than 1 million net subscribers five quarters after
> launching
> > > its mobile virtual network operator service using Sprint PCS' network
> July
> > > 24, 2002...
> >
> > ..."and nearly twelve of them are over 16 years old, sources at Virgin
> explained..."
>
> I still can't fathom what basses of the hatred toward prepaid cellular
> phones is.

I have no hatred of PPD at all. In fact, when I was a cellular
dealer, I really pushed pre-paid- not to the credit challenged, but to
the low-volume user. At that time, SBMS (eventually Cingular) had
180-day $20 cards. You could have minimal useable cell service for
$40/year! We sold a ton to the elderly, and to parents of school-aged
children. We didn't make a ton of money on each sale, but were
penetrating a market that didn't want to spend $20-30/month for
emergency service.

I'm also a happy CallPlus user, since it's AT&T-based TDMA/analog
service is an ideal rural/travel backup for my T-Mo GSM-only service.

> "They are just child toys... bla bla bla......."

I poked fun a Virgin because they have perhaps the best PPD rate in
the biz, but market it so aggressively at the MTV-set, that many
adults don't even know it exists. I'm Not arguing with it's success,
but wonder if they shouldn't also market to adults, perhaps with a
differenr model phone, and different data features (i.e. news, sports
and weather instead of what Britney and Justin are up to!)

> Some analyst point out that the ARPU is lower, so they must be the "credit
> challenged"
> And since the ARPU is lower, that can't be any good for the company.
>
> FU*& the ARPU.

I agree with you- the ARPU is low, but the "ARPM" (Average Revenue Per
Minute) is hugh compared to a bandwidth-hogging 1000 min./month
customer.

> The reason it's lower is because they don't offer any prepaid plans that
> are useable to the heavy users.
> That is the company's fault, not the user's fault.

Arguably that would defeat the purpose, since most companies would
fear a truly attractive pre-paid plan would cannibalize the company's
post-paid customers, who are "safer" since they're more likely to be
obligated with contracts.

I wonder how Go Phone is working out for AT&T- I think it's strategy
was brilliant. Better deal for higher volume users than any other
pre-paid, yet not quite as good as a "real" plan, so they don't
threaten the contract business.

> And the company doesn't have as much overhead with
> prepaid customers because they don't have subsidies to shove out.

Sure they do- just smaller ones. Go Phone, for example, tosses you a
color Nokia phone for under $100 after rebate.

> So that means the company makes more profit from them
> even though they have a lower ARPU.
> It's the profit per user and not the dang ARPU that counts.
> But that is something that most analyst are too stupid to comprehend.

Except that there are fixed costs to keeping a number active in
billing, etc. I don't know how CallPlus makes a dime off of me at
$3.33/month. Subtract the Universal Service Fund and other fees and
not much is left! Granted I've only used 15 minutes airtime in the
last six months... ;-)

> Another thing they are two stupid to understand is profit per network
> utilization.

Agreed.

> If you earn $20 per month at a profit of $15 per month from a prepaid
> customer
> and you can support 1000 users per a chunk of spectrum in a market.
> It will be far more profitable than 1000 users that earn you 60 dollars
> each a month.
> Because they talk ten times a much and only earn you four times the money.

To a point- that only holds true if the network runs near capacity.
There is no advantage to small volume users on an empty (i.e. rural)
network. You might as well sell them all higher-dollar unlimited use
plans!

> And the only other thing I can think of is the fact that companies can't get
> them under contract.
> But that is something that people should hold them in high regard for,
> Because they are not stupid enough to get themselves rapped up
> in a dang two year contract.

Right, but it limits their loyalty to tomorrow's better deal!

> They can take there fu#&ing contracts and shove them up their a$$.
>
> ......(rant off)...........
> Ahh... It felt good to get that off my shoulders. :-P

Glad I could help! ;-) Great post, BTW- very thought provoking!

In alt.cellular Todd Allcock <[email protected]> wrote:

> I poked fun a Virgin because they have perhaps the best PPD rate in
> the biz, but market it so aggressively at the MTV-set, that many
> adults don't even know it exists.

At the convenience store across from my sister-in-law's apartment, there is a
flyer at the coutner touting Virgin's 25-cents-for-the-first-ten-minutes-10-
cents-after-ten-mintues rates. Even 25 cents per minute is a good price for
prepaid, and actually, that deal is the best I've ever seen on a prepaid
plan. They could, if they were smart, probably sell to a lot more people than
just kids at the mall.

--
JustThe.net Internet & New Media Services
22674 Motnocab Road * Apple Valley, CA 92307-1950
Steve Sobol, Proprietor
888.480.4NET (4638) * 248.724.4NET * [email protected]

[email protected] (Todd Allcock) wrote in message news:<[email protected]>...
> I poked fun a Virgin because they have perhaps the best PPD rate in
> the biz, but market it so aggressively at the MTV-set, that many
> adults don't even know it exists. I'm Not arguing with it's success,
> but wonder if they shouldn't also market to adults, perhaps with a
> differenr model phone, and different data features (i.e. news, sports
> and weather instead of what Britney and Justin are up to!)

22 year old VM user here... I also know a 40-something mom who uses
Virgin, and have convinced my 50-something dad to get Virgin when his
$20/month T-Mobile contract runs out... so it's not all 12 year olds.

Having said that, it's all about branding, and instead of trying to be
everything to everyone, like the other cell companies, Virgin's chosen
to focus on a niche market. They are THE brand for teenagers,
eclipsing other companies that have similar deals, like Verizon. I
think a major part of that success has been because they are so
committed to that niche. The teens are a lot more lucrative a market
for them anyway. They'd much rather have a teen who doesn't really
know the value of money, or has her parents pay for it all. Someone
who's willing to spend 40 bucks a month voting for their favorite
songs on MTV is a much more attractive customer than I, who barely
spends 10 bucks a month and has never used a VirginXtra.

The News/Weather extras really wouldn't have much of an audience,
because most of the adults who use Virgin (like myself and the 2
others I mentioned above) are light cell phone users. Adults who want
that sort of content are typically heavier cell users, and are already
on some sort of plan. I do think they should partner with ESPN or
some other sports content provider to appeal more to teenage males
though. I can imagine that if I were still in high school, I'd
certainly want to get up-to-the-minute NCAA tournament scores on my
phone, for example. Back in my day, we had to use a computer to goof
off in class

[email protected] (Slinky) wrote in message news:<[email protected]>...

> 22 year old VM user here... I also know a 40-something mom who uses
> Virgin, and have convinced my 50-something dad to get Virgin when his
> $20/month T-Mobile contract runs out... so it's not all 12 year olds.

I agree- but if you weren't "selling" it for Virgin, your 50-year old
dad wouldn't know it existed!

> Having said that, it's all about branding, and instead of trying to be
> everything to everyone, like the other cell companies, Virgin's chosen
> to focus on a niche market. They are THE brand for teenagers,
> eclipsing other companies that have similar deals, like Verizon. I
> think a major part of that success has been because they are so
> committed to that niche. The teens are a lot more lucrative a market
> for them anyway. They'd much rather have a teen who doesn't really
> know the value of money, or has her parents pay for it all. Someone
> who's willing to spend 40 bucks a month voting for their favorite
> songs on MTV is a much more attractive customer than I, who barely
> spends 10 bucks a month and has never used a VirginXtra.

True enough- that's why I sort of suggested that if they branch out
for the older set, they should do it with a different branding, like
GM sold Oldsmobiles to a different market segment than Chevys or
Caddies.

I can see it now: "The Old Phart Phone by Virgin"... ;-)

> The News/Weather extras really wouldn't have much of an audience,
> because most of the adults who use Virgin (like myself and the 2
> others I mentioned above) are light cell phone users. Adults who want
> that sort of content are typically heavier cell users, and are already
> on some sort of plan. I do think they should partner with ESPN or
> some other sports content provider to appeal more to teenage males
> though. I can imagine that if I were still in high school, I'd
> certainly want to get up-to-the-minute NCAA tournament scores on my
> phone, for example. Back in my day, we had to use a computer to goof
> off in class

I'd of been hitting my phone hard for Red Sox-Yankee updates in the
ALCS if I'd known where to find them! ;-)

I was connecting my PDA to my T-Mo phone to get to MLB.com during one
game when I was at a restaurant and couldn't get near a radio or TV!

!
>
>
>>Having said that, it's all about branding, and instead of trying to be
>>everything to everyone, like the other cell companies, Virgin's chosen
>>to focus on a niche market. They are THE brand for teenagers,
>>eclipsing other companies that have similar deals, like Verizon. I
>>think a major part of that success has been because they are so
>>committed to that niche. The teens are a lot more lucrative a market
>>for them anyway. They'd much rather have a teen who doesn't really
>>know the value of money, or has her parents pay for it all. Someone
>>who's willing to spend 40 bucks a month voting for their favorite
>>songs on MTV is a much more attractive customer than I, who barely
>>spends 10 bucks a month and has never used a VirginXtra.
\
==========================================================
Well I sure do not want to be a Teenager again... But 30 would be
nice... Nah I am addicted to being retired and at 30 I did not have the
ability to retire...

Anyhow... My wife I use Virgin Mobil after buying the phones we do have
to "top off" once every 90 days (15 bucks min)...BUT we have never ever
needed to purchase additional time... so for 5 bucks a month each
VIRGIN is a good and cheap deal for us...

Sorry but I have absolutely no use nor interest in Virgin Extras... took
3 to 4 months to find out how to use the voice mail feature...

Bob Griffiths