MetroPCS Communications Inc.
(
PCS
), one of the leading prepaid telecom carriers in the U.S. has
launched a 4G smartphone - Spirit 4G.
Google Inc.'s
(
GOOG
) Android based Spirit 4G by LG Electronic is available at $199
plus tax with no contract. For 4G services, customers can team up
their smartphone with MetroPCS' affordable 4G plans starting at
$40. We believe the company's effort to boost its LTE services
with new offers and product launches garners significant market
traction, driving market penetration and revenue
growth.
Earlier this month, MetroPCS reported net subscriber loss of
93,237, a steep drop from the year-ago gain of 197,410
subscribers. Stiff competition at the high-end smartphone market
that remains dominated by large players is mainly responsible for
the shrinking customer base. High-end devices like
Apple's
(
AAPL
) iPhone and the Samsung Galaxy series are mostly availed through
tiered contracts at cheaper rates with giant sellers like
AT&T, Inc.
(
T
).
As a result, it becomes important for the company to introduce
competitive products that can address the present need of its
target market. Although, the company does not market Apple
products, it has set a line-up for the popular Android-based
devices.
In 2011, the company launched it ambitious project "Android
for All" program that increased smartphone penetration to 50% of
its total subscriber base. In August 2012, MetroPCS launched LG
Connect 4G Android smartphone, representing the first-ever launch
of VoLTE (Voice over LTE) enabled 4G LTE smartphone globally.
The company aims to deliver spectrum efficiency by shifting
its customers to the VoLTE service. This move would increase
network capacity and boost free spectrum, leading to enhanced 4G
experience.
Further, MetroPCS also forayed into the live mobile TV market
with the launch of Samsung Galaxy S Lightray 4G. The phone is
enabled with Dyle application that enables users to watch live
shows through a broadcast television signal. The company's mobile
TV services are branded as Dyle Mobile TV. The company expects to
cover Dyle Mobile TV in 32 markets, including major hubs like
Atlanta, Las Vegas, Los Angeles, New York, Boston, San Francisco,
Texas, Detroit, Dallas, Jacksonville, Philadelphia, with 72
stations and 50% coverage of its subscriber base over the near
term.
We believe the advanced 4G LTE network, cost effective 4G
devices and affordable 4G service plans will remain the key
drivers for MetroPCS' near-term prospects. The company has
already deployed high-speed 4G LTE services in most of its major
markets and covered 97% of its market with a 5x5 megahertz
channel bandwidth.
MetroPCS has a Zacks Rank #3 (Hold).
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