Monday, November 30, 2009

The Direction of Boost & Virgin

With Sprint's recent purchase of Virgin Mobile, Boost Mobile and Virgin are now both operated by the same company. Both are popular prepaid services and both offer a lot of value with about a $50 per month price level for Unlimited talk. Sprint needs to do one of 2 things with these separate brands: combine the 2, or, more likely, do something to make them contrast even more than they do now.

Virgin uses the Sprint network only, and Boost uses the Nextel network exclusively, with a few exceptions. In the mind of the typical wireless customer this shouldn't be enough of a difference to choose one over the other. They will each need a unique "hook" and the most obvious hook is price. We wouldn't expect either one to rise above the $50 price level, so what's left? We're guessing one of these services will be designated the "Premium" prepaid, and one will become the "Value" service. The Value sibling may be the one that goes after the $25 to $40 prices being charged by Cricket and Metro PCS.

After paying almost $500 million for the Virgin brand, one would not think Sprint would buy it just to lower the price of the product. So that leads us to believe that there may be a $40 Boost Mobile plan coming. Of course Sprint could also consider Nextel's "Direct Connect" (PTT) feature as the premium in the industry, especially as they end their use of the "Q-Chat" PTT service on the Sprint network.

We'll be watching for both our Unlimited page, and our Prepaid site. Let the price wars roll!

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