Cricket's New Rate Plans and MVNO agreement with Sprint

JFB · Aug 4, 2010

*Press Releases*

Also mentioned in the 2nd release below is that they will change their corporate name from LEAP to Cricket.

Cricket Communications Enters Into Wholesale Agreement With Sprint

~ Five-Year Agreement Expands Cricket's Foundation for Continued Growth ~
~ Creates National Opportunity for Cricket's Prepaid Services ~

SAN DIEGO, Aug 03, 2010 (BUSINESS WIRE) --

Leap Wireless International, Inc. (NASDAQ: LEAP), a leading provider of innovative and value-driven wireless communications services, today announced that its operating subsidiary Cricket Communications has entered into a wholesale agreement (MVNO) with Sprint, which will allow Cricket to offer its products and services over Sprint's 3G network throughout the United States.

"This agreement with Sprint creates a new hybrid wholesale and facilities-based model that is unique in the industry," said Doug Hutcheson, Leap's president and CEO. "We believe that our ability to offer compelling 3G voice and data services in markets we do not currently serve will allow us to further establish a national brand and attract new customers for our exciting Cricket products, including Smartphones and other services. In addition, we believe that this agreement will allow us to significantly strengthen and expand our retail position and distribution relationships."

"We are pleased to work with Leap as one of many key partners we support through Sprint's growing wholesale business," said Dan Dooley, president - Sprint Wholesale. "Most importantly, we believe this relationship is beneficial for Sprint as we continuously look for ways to optimize the utilization of our network and ultimately create significant value for our shareholders."

As part of the agreement, Cricket has made commitments to deliver minimum levels of revenue to Sprint. Cricket will also realize improved economic terms as it grows subscribers added through the wholesale agreement.
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Leap Lays out Growth Plans for Prepaid Wireless Business
~ All-Inclusive Service Plans and New Devices Expected to Reduce Churn and Drive Subscriber and Revenue Growth ~
~ New Tiered Plans for Mobile Broadband Expected to Increase ARPU and Expand Margins ~
~ Go-to-Market Plans Unveiled to Drive Sales of Higher-End Service Plans and Devices ~
~ Back Office Systems Upgraded to Support Subscriber Growth ~
~ Wholesale Agreement Provides Path to National Offerings and Strengthens Distribution Opportunities ~
~ Roaming Agreement Provides National 3G Data Access ~
~ Company to Change Corporate Name to Cricket ~
SAN DIEGO, Aug 03, 2010 (BUSINESS WIRE) --

Leap Wireless International, Inc. (NASDAQ:LEAP), a leading provider of innovative and value-driven wireless communications services, today made a series of announcements at its Analyst Day in New York designed to significantly advance its business model as a national value leader and capitalize on the rapid growth of prepaid wireless services. The Company today outlined its vision that the prepaid segment of the wireless market is at a pivotal juncture where affordable, advanced devices such as Smartphones and tablets, paired with unique services, and supported by high-speed networks, create an opportunity for the Company to significantly grow its business.

Throughout the day, Leap's management team discussed its initiatives to increase scale, lower customer churn and drive sales, ARPU and cash flow. The Company also discussed recent improvements it has made to its back office systems, including inventory management and point-of-sale systems, as well as its plans to leverage its fully-built 3G network and migrate to 4G LTE technology in future years. It also unveiled new advertising, dealer incentives and other go-to-market strategies designed to drive sales of higher-end plans and devices.

Additional announcements made today included:

$35, $45, $50 and $60 true rate, all-inclusive, unlimited nationwide talk and text service plans that simplify the billing process and provide greater choice and flexibility for customers.
$40, $50 and $60 all-inclusive, unlimited service plans for broadband devices that give consumers greater choice and improve the efficiency of the Leap network and that are designed to increase ARPU and expand operating margins.
The introduction of a robust lineup of 15 new devices and Smartphones, including the BlackBerry Curve 8530, the Sanyo ZIO by Kyocera and the Samsung Messager Touch, and complementary plans.
The entry into a new wholesale relationship that will enable Cricket to offer its products and services on Sprint's 3G network.
A new roaming arrangement that will enable Cricket to offer its customers national 3G roaming.
Plans to launch an exciting new proprietary music service in early 2011.
"The wireless industry is evolving toward a completely new model and everything we announced today is aligned with this new dynamic," said Doug Hutcheson, Leap's president and CEO. "We are one hundred percent focused on realizing our vision for the industry and Cricket's leading position in it. We believe we have the right assets, the right plan and the right model to seize the huge opportunity in front of us and be the national leader in prepaid."

Earlier in the day, Leap executives discussed its new business model which has been in development for the past several quarters and is now being implemented. While some of the initiatives are expected to have an immediate and positive impact on customer activity, the Company expects the collective impact of its new business model initiatives will take several quarters to translate into meaningful growth.

Leap outlined its plans to leverage its 3G network and described its farsighted 3G/4G strategy, emphasizing how its existing 3G network provides positive cash flow and greater flexibility for the planned migration to LTE in future years.

The Company also announced a groundbreaking five-year roaming wholesale agreement with Sprint that is expected to strengthen Cricket's national retail distribution relationships and support the Company's goal of establishing Cricket as the national value leader in the rapidly expanding prepaid wireless segment.

The Company also announced a roaming arrangement that will allow Cricket to provide nationwide 3G data services to its customers.

Given the increasing power of the Cricket brand and the planned investments the Company intends to make in marketing to support its products, services and brand as a national carrier, the Company also said it intends later this year to change its corporate name from Leap Wireless to Cricket. Until this change is formalized in the coming months, the parent company will continue to operate as Leap Wireless International, Inc. and its stock will continue to trade under the ticker "LEAP" on the NASDAQ.
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spleck · Aug 4, 2010

I bet this will help them grow in markets where they don't have a 1900 PCS license, but they do have a 700 or 1700 license. They can build their new LTE network and roam on Sprint to fill in gaps. Sprint gets money, which they need. Sounds like a good deal.

I also like Cricket's data plans. According to another report I red, you get X amount of data at full speed, then you still have unlimited data at a lower speed. The cap is on a rolling 30 day period.

M in LA · Aug 4, 2010

Leap needs this or they won't be around much longer. I still wish they'd merge with Metro...

spleck · Aug 5, 2010

Yeah, I'm surprised they can hang around and compete with stuff like Straight Talk running on VZW, and now AT&T. I guess they're one step above that, and one step below the majors.

EdwardP · Aug 12, 2010

There has been mention online that T-Mobile is also getting involved with Straight Talk. Given that they lost 200,000 prepaid customers directly, during the 2nd quarter, T-Mobile must improve its own prepaid offerings.

The .99/hour charge for unlimited mobile web on T-Mobile prepaid is a start, but I think it needs to be improved to the point where they ought to charge a flat fee for x amount of Kb.

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