Summary
metroPCS has signed a contract to launch a next generation 4G mobile network based on Long Term Evolution (LTE) technology with Sweden’s Ericsson late next year. The dual mode LTE/CDMA handsets will not be available in reasonable cost for a carrier like metroPCS to launch their service. Most likely scenario will be dangles for unlimited data plan and not for voice and messaging.
Analysis
metroPCS awarded its LTE radio network deployment to Ericsson. The most likely scenario for metroPCS is to provide unlimited prepaid data plan, very similar to its current unlimited voice and text messaging plans. Dual mode CDMA/LTE devices will not be available at economical cost range for metroPCS to be able to deploy these handsets to the cost conscious segment that it targets. Also, for these dual mode devices, the core of the network must be able to support voice and messaging and that implies an IMS core which is not part of the deal. All signals point to two fold strategy of voice and messaging over existing CDMA/1xRTT network and unlimited data using dangles on the LTE.
As a result, there will be no real impact on the ARPU to metroPCS for voice and they will probably benefit from the unlimited data plan (assumption is about $29.95 a month per subscriber.
This author consults with leading institutions through GLG
Analyses are solely the work of the authors and have not been edited or endorsed by GLG.
