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In Response to Leap's New Plans – Cricket's

Prepaid provider Cricket Communications, Inc. introduced what it's calling game-changing, disruptive new Phone Payment Plans to its customer base Wednesday, but the news got a little overshadowed by Friday's announcement that AT&T Inc. is acquiring its parent company Leap Wireless. (See AT&T to Acquire Leap Wireless for $1.19B.)

How can we get excited about low-cost pricing plans with a potentially limited shelf life?

Cricket's Phone Payment Plan lets its customers pick out a phone and get either no interest, deferred interest or no credit check after a down payment. With the no interest plan, you put 4 percent down and pay 4 percent of the total plan each month for two years. If you prefer to defer interest, you'll put 5 percent down and then pay a minimum of 5 percent each month, without interest if it's paid off in six months. If you have bad credit, you can choose to forgo a credit check and put 8 percent or more down and same as cash for 90 days.

In an online press conference announcing the new plans, Cricket President and COO Jerry Elliott called them "more competitive than any prepaid or postpaid carrier" and said the plans will help Cricket retain customers longer. When asked if the plans would stick around post merger with AT&T, he couldn't commit.

"Until the transaction actually closes, we're two completely separate companies and fierce competitors," Elliott said. "We'll move forward with everything we talked about today," which also includes the launch of two new Galaxy smartphones and an update to Cricket's Muve Music service.

Cricket's new plans are interesting because they come during a month that has also seen AT&T, T-Mobile and Sprint change up their service plans. The reason why they are doing so is clear. As GigaOm's Kevin Tofel aptly outlines, smartphone trade-ups are happening at a much slower pace, but carriers want to keep their customers continuously upgrading, paying more and on their LTE networks for as long as possible. (See AT&T's Next to Shorten Wait for Device Upgrades, Sprint Fires Back at T-Mobile With Unlimited Guarantee and T-Mobile: Might as Well JUMP.)

Cricket's new plans do undercut the competition significantly and likely will appeal to the cash-strapped amongst its customer base. I'm just saying, don't get too attached.

— Sarah Reedy, Senior Editor, Light Reading

Sarah Thomas 7/19/2013 | 3:10:06 PM
re: In Response to Leap's New Plans – Cricket's I agree and think it'll be a good way to get those holdouts interested in smartphones and to convince others that like smartphones to upgrade to the highest end ones like the iPhone and Galaxy S. It's a smart move on Cricket's part.
MordyK 7/17/2013 | 9:48:11 PM
re: In Response to Leap's New Plans – Cricket's The flexibility of payment options is what I like best about Leap's approach. This is especially true with the introduction of a no credit check for the lower bracket of people, which are some of the last holdouts on the march toward universal smartphone adoption, and require a different approach to deal with the increased cost which is a significant barrier to purchase.

Kinda reminds me of the flexibility car manufacturers have with the lease and finance options, all in an effort to push more cars out of the lot.
Sarah Thomas 7/17/2013 | 9:18:07 PM
re: In Response to Leap's New Plans – Cricket's It's good to see that Leap is still innovating as it waits to be acquired (oh wait, I remember saying the same thing about T-Mobile!). It's prepaid business is well established, so AT&T could keep it around as is. We'll see. AT&T also just recently launched a prepaid brand Aio. I bet that might go away or get folded in either way.
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