Tuesday, October 16, 2012

The Phone Economist – Think Like a CEO (of Your Family)

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When a new CEO takes over at a company, their first step is often to look for ways to cut costs while still providing everything their company and customers need. You can do the same with your family’s phone service.


Across America, the adoption of smartphones and mobile devices continues to grow. A recent survey from Pew Internet shows that 46% of Americans now own a smartphone. With smartphones come more ways connect to Facebook, watch videos and text with friends and family. However, all that connectivity uses a lot of data and comes with a price.

According to a recent CNN article about cell phone carrier loyalty, “As data use grows, people are talking on their phones less. The average subscriber used just 638 voice minutes per month in 2011, down from 720 minutes in 2010.”

We use our phones differently now than we did in 2011, and very different from the way we used them in 2010. As you change your behavior, you should also change the way you pay for your phone. According to JD Power, the average cell phone bill is now $71. Look at what you’re using each month. If you own your phone, you can have unlimited talk, text and even data for only $45 a month.

Saving $26 a month sounds good in and of itself, but when you look at what you’ll save in a year, the figure comes out to over $300. If you have two or three phones in your family, your annual savings quickly approaches $1,000. When you think of your cell phone, think like the CEO of your family—and see how just how much money you can save.

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Surpassing Verizon, TracFone notches 1.1M net adds in Q4

By Mike Dano
http://www.fiercewireless.com

Feb. 9 2011 - 6:03 pm - América Móvil's TracFone MVNO service netted a whopping 1.1 million new subscribers in the fourth quarter of 2010, finishing the period with a total of 17.7 million subscribers.

TracFone's net adds put it in the same league as some of the nation's Tier 1 wireless carriers. For example, Verizon Wireless (NYSE:VZ [1]), the nation's largest wireless carrier, recorded 955,000 total net customer additions in the fourth quarter, ending the period with 102.2 million "total wireless connections."

Such a comparison isn't completely fair, however. TracFone doesn't operate its own wireless network--instead, as an MVNO, the company essentially piggybacks on the networks of Verizon , AT&T Mobility (NYSE:T [2]) and T-Mobile USA, reselling their services under TracFone's brands, which include Straight Talk, Net10 and others. Thus, TracFone's net customer additions are also counted by its host carriers under their "wholesale" column.

Nonetheless, TracFone's stellar growth is notable. The company has grown its U.S. subscriber base from 14.4 million in December of 2009 to 16.7 million in September 2010 to 17.7 million at the end of the fourth quarter of last year.

As for TracFone's subscriber metrics, the company's minutes of use skyrocketed 219 percent year over year, from 94 in the fourth quarter of 2009 to 300 in the fourth quarter of 2010. TracFone attributed the growth to its Straight Talk unlimited service. TracFone's average revenue per user grew from $10 to $14 during the same period while its churn remained relatively unchanged at around 4 percent.

Read the full story here.

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CTIA-The Wireless Association's statement on usage and cost for mobile phone calls

WASHINGTON, DC CTIA-The Wireless Association® issued the following statement today in response to the OECD Communications Outlook report on usage and cost for mobile phone calls:

The headline from the recently released OECD Communications Outlook report reads that Finland, the Netherlands, and Sweden have the lowest prices for mobile phone calls among OECD countries, while the highest prices were found in Canada, Spain, and the United States. But since U.S. consumers enjoy the lowest per minute rates of all of the OECD countries, what today’s OECD report really shows is that some international comparisons just don’t make sense – especially when built on flawed assumptions.

The real story is buried on page 275 of the OECD report which states:

“It is important to note again that the OECD calling pattern in the basket can be significantly different than common calling profiles in a specific country. For example, the high-usage OECD basket includes 1,680 outgoing voice calls per year while users in the United States average 9,600 minutes of voice calls (combined incoming and outgoing) per year. In this case the basket provides the cost of buying exactly the calls and messages in the OECD basket rather than what may be considered a ‘typical’ bundle in the market.”

Read the full article here.