TracFone's $45 unlimited offer to 'stun' rivals

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TracFone's $45 unlimited offer to 'stun' rivals
July 2, 2009 — 9:46am ET | By Phil Goldstein

America Movil's MVNO TracFone Wireless quietly unveiled a prepaid, nationwide unlimited offering for $45 per month that includes unlimited text messaging and 30 MB of data. The service, running over Verizon Wireless' network and available at participating Wal-Mart stores, stands as another major action in the white-hot battle for limitless wireless service.

The news likely will "stun industry participants," Pali Research analyst Walter Piecyk wrote in a note to investors. Shares in regional, unlimited wireless carriers Leap Wireless and MetroPCS fell on worries of increased competition.

Piper Jaffray analyst Chris Larsen said Leap and Boost Mobile, Sprint Nextel's prepaid unit, would be especially vulnerable. Indeed, Boost's $50 unlimited talk, texting and Web browsing plan, launched earlier this year with major fanfare, generated such interest that Sprint's iDEN network clogged under the load before the carrier added capacity.

Verizon spokesman James Gerace told Reuters that the carrier would make sure its network would not be overwhelmed if the TracFone offer results in a similar spike in traffic. Gerace also said that the new plan would not make Verizon change its own retail pricing. Verizon offers an unlimited postpaid offering for $100 per month.

TracFone's $45 unlimited offer to 'stun' rivals - FierceWireless