Budget US MVNO Ting Mobile believes it can keep prices low despite a proposed merger between Sprint and T-Mobile US which will eliminate competition between its two main suppliers, an executive told Mobile World Live.
Currently, Ting Mobile buys wholesale service separately from Sprint and T-Mobile. Michael Goldstein, Ting Mobile’s VP of sales and marketing, admitted the idea of moving from two suppliers to one is “disconcerting”. But, he added: “I never expect them to come back to me and look to increase prices,” noting Ting Mobile negotiated lower rates with Sprint three times and twice with T-Mobile over the last seven years.
The comments come as operators and MVNOs across the country weigh the potential impacts of the merger. In recent filings with the US Federal Communications Commission (FCC), cable operator Altice USA (which has an MVNO agreement with Sprint) and wireless operator C Spire (one of Sprint’s roaming partners) warned the transaction could negatively impact wholesale and roaming agreements.
Tucows, an internet services company which owns Ting Mobile, said in its filing the deal makes “excellent business sense,” but urged the FCC to attach conditions which will “nurture and protect” competition from the MVNO market. Specifically, it called on regulators to adopt measures that will preserve fair pricing and prevent suppliers from locking MVNOs to a single network.
Goldstein said Ting Mobile secured lower contract rates with Sprint and T-Mobile as recently as a few months ago, and is planning to pass on those savings to its customers in the near future.
He noted the average usage-based monthly service cost for Ting Mobile customers is around $23, which includes consumption of an average of less than 1GB of data, along with voice and text.
The forthcoming price drop, however, may not reduce customers’ monthly spend: “What we’ve found is that as prices go down, people end up treating themselves to more data. As a result, we land at a similar ARPU, but with them getting to enjoy more data.”
Despite predictions mobile data use is set to skyrocket, Goldstein said Ting Mobile expects its current usage-based billing model will continue to be viable in a 5G world, particularly as cities, campuses and other venues increase the reach of Wi-Fi, which carries customers’ data traffic for free.