America Movil S.A.B de C.V., the Mexican parent company of prepaid MVNO TracFone has announced in a press release that it has completed the purchase of T-Mobile USA exclusive MVNO Simple Mobile after first being announced last month during the end of this year’s edition of CTIA Wireless 2012. The completion of the purchase will now allow America Movil through US subsidiary TracFone to begin the process of integrating the company and the brand into the America Movil portfolio of US mobile service brands going forward.
The purchase of the MVNO also included the buyout of T-Mobile’s 30% stake in the operator which will allow Tracfone to offer services not found on other independent MVNOs in the US such as BIS support for BlackBerry smartphones and international SMS messaging on top of direct access to T-Mobile’s “4G” HSPA network. While America Movil previously negotiated access to T-Mobile’s network for TracFone and StraightTalk in order to launch its BYOD SIM offering, the integration of Simple Mobile with TracFone and America Movil will serve to expand Simple Mobile’s presence to more retail locations, being previously limited to third-party dealers and online sales.
The forthcoming expansion of Simple Mobile will also signal a further shift away from bundling handsets with prepaid cell service service in the US, as Simple Mobile was novel in that it did not directly offer its own lineup of branded handsets as is common to other MVNOs and instead sold re-branded T-Mobile SIM cards for those customers that already had unlocked phones or handsets previously sold directly by the carrier. America Movil also has plans to roll out BYOD SIM sales later this year via Net10 and StraightTalk through their current retail channels, though it plans to start the initiative with Simple Mobile via expansion first in order to gauge popularity.
Currently, Simple Mobile offers a slate of service plans for interested customers, starting at $25 for two weeks of unlimited voice and messaging service targeted towards international travelers all the way up to $60 for unlimited voice, messaging and data access, though it appears that Simple Mobile has recently started to adopt a hard cap of 2GB for all monthly rate plans regardless of 3G or 4G access per month.
As TracFone consolidates its position within the nascent SIM-only sector of the growing US prepaid market segment, it falls on the entrenched incumbents to compete with the brands in order to foster even higher levels of competition, now the prepaid service has largely shed its previous stigma of being a second class alternative to postpaid cell service and is now a viable alternative to increasingly onerous and expensive postpaid agreements with fewer and fewer advantages, including coverage.