By Greg Bensinger
verizon Wireless may expand a $50 unlimited prepaid offering it has been testing in Florida and California to additional markets, an immediate threat to rivals Sprint Nextel and MetroPCS.
“The trial has gone very, thoroughly for us,” said verizon Chief Financial Officer Fran Shammo during a presentation in Boston. “It didn’t cannibalize the bottom and we really evaluated our prepaid business and took some share.”
The prepaid plan, referred to as Unleashed, offers users unlimited voice time, texting and Web. Sprint, with its Boost and Virgin Mobile brands, also sells unlimited pay-as-you-go plans, as does MetroPCS.
Prepaid, which has historically been marketed to lower-income consumers and is more subject to user turnover, makes up a small part of verizon Wireless’s business. Verizon had 4.4 million prepaid customers as of the top of June, 3.4% fewer than a year earlier, while the carrier grew its contract customers by 4.6%within the period to 85.3 million.
By contrast, Sprint and MetroPCS lifted their prepaid subscriber rolls by 5.1% and 19%, respectively, as of the top of the 1st half.
Separately, Shammo said a cut to union workers’ benefits is important because the company’s traditional wireline business continues to say no. About 45,000 union employees walked off the job on Sunday after talks for a brand new contract reached an impasse.
Verizon Communications, based in Ny, desires to freeze pensions, tie workers’ pay more closely to performance and require employees to contribute at the very least $100 a month to their healthcare premiums, among other items. The strike entered its fourth day Wednesday.
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