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Order Up!
Is “all-you-can-eat” on the MVNO menu?
What’s on the horizon for prepaid? AT&T and Verizon Wireless have begun the “all-you-can- eat” revolution, offering unlimited minutes for a set fee. MVNOs stand to benefit from this revolution as long as they cash in on the opportunities and look out for the challenges.
Flat-rate vs. prepaid
The costs associated with the fl at-rate/prepaid relationship determine how prepaid compares to all-you-can- eat plans. The cost-per-minute of fl at-rate billing fluctuates based on the amount of minutes an individual uses. Prepaid operates in much the same way – the cost-per-minute may decrease based on the amount you purchase (the value of your top-up). Aside from cost-per-minute, the differences between fl at-rate billing and prepaid billing boil down to two things: contracts and credit checks. Most fl at-rate billing plans offered through a mobile network operator (MNO), such as Verizon Wireless, have the same requirements as post paid plans: a contract and often a credit-check. Traditional prepaid users avoid both of these by purchasing a phone and prepaying for minutes. If the prepaid industry wants to implement all-you-can-eat plans, they need to consider new management solutions, new markets and network capacity and expansion.
Freedom Wireless patents
Freedom Wireless has a number of patents specifically surrounding the management of wireless prepaid telephone networks, says Niall Norton, CEO of Openet, a provider of transactional intelligence solutions. These networks (MVNOs) have an opportunity to circumvent these patents by offering all-you-can-eat plans. The dynamics of the processes will change. A balance of minutes will not exist; therefore calls will not need to be terminated if a balance is low. MVNOs will be able to take steps to create and utilize their own methods of operation. This will save time and money, while fostering innovation.
New market
All-you-can-eat plans attract a specific type of consumer. The consumer constantly topping up their prepaid account will look at all-you-can-eat plans as beneficial to their budget. Offering these plans will open new markets for MVNOs.
Spectrum overload
MVNOs will face challenges if they offer all-you-can-eat plans. Operators could face revenue problems and have issues with wireless spectrum allotment. The biggest risk operators face with fl at-rate plans is your customers could “go bananas,” Norton says. Usage will continue to climb because consumers are no longer restrained by paying per minute.
Fixed revenue
Operators see a scenario where their monthly revenue is fixed. No longer will ARPU be factored onto the ledger. If customers’ monthly usage increases, operators must invest significant money to increase network capacity for the extra traffic. The possibility operators cannot keep up with demand is real. “The economics are very dangerous for an operator,” Norton says. Operators could face an even bigger problem – there is a finite amount of wireless spectrum. “No matter how much money you spend, you may never be able to actually keep up with demand,” Norton says.
The all-you-can-eat opportunity exists for MVNOs, as long as steps are taken to recognize the benefits and obstacles the new programs have. Flat-rate plans could evolve the prepaid business.
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ICN Wire 05.16.08
Altair, Blueberry launch prepaid card in U.K.
Altair Financial Services International Plc. and Blueberry Card Services Ltd. launched the BaBee prepaid MasterCard card in the U.K. The new card is designed specifically for new mothers to manage their finances and save money on expenses. The card gives access to a number of discounts on everyday items such as groceries and gas. Altair is a prepaid card and global transaction processor. Blueberry is a provider of consumer prepaid services. www.babeecard.com
AT&T GoPhone Feature Card added to Touch-n-Buy
Touch-n-Buy added the AT&T GoPhone Feature Card to it’s suite of products. These cards are available at the Touch-n-Buy kiosks, and come in denominations of $5, $10 and $20. The card offers savings on text messaging. The $5 card offers 200 text messages, the $10 card offers 1,000 and the $20 card offers unlimited text messaging. The Touch-n-Buy interactive kiosk is a Blackstone electronic transaction system. www.blackstoneonline.com
Bridgewater appoints Fekih EMEA Managing Director of Sales
Bridgewater Systems appointed Ihsen Fekih as managing director of sales for Europe, Middle East and Africa (EMEA). Fekih will be based in London and lead the direct sales and services activities for EMEA. www.bridgewatersystems.com
First Data expands presence in India
First Data Corp. signed a card processing agreement with Kotak Mahindra, a financial conglomerate in India. The five-year agreement supports First Data’s expansion into the Asia Pacific market. First Data will provide processing services for Kotak's unsecured lending portfolio, supporting the launch of a new credit card and loan portfolio. Client services support will be provided locally from First Data's offices in Mumbai. www.firstdata.com
Oberthur receives achievement award
Smart card provider Oberthur Technologies is the recipient of the 2008 Smart Card Alliance OSCA award. OSCA, or Outstanding Smart Card Achievement, is given to companies that have demonstrated outstanding achievements or shown exceptional leadership that significantly impacts the North American smart card marketplace. www.oberthur.com
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ICN Wire 05.09.08
Arthur Blank & Co. purchases two high-speed KURZ web collators
Arthur Blank & Co., a division of American Banknote, added two new KURZ MWS-750 collator machines to its inventory of card manufacturing equipment. The new collators will operate at 1,200 sheets per hour, supporting Arthur Blank’s existing 1.5 billion card capacity. www.arthurblank.com
HTC appoints Brightpoint as sole distributor for U.K. and Ireland
HTC Corporation appointed Brightpoint Inc.’s wholly-owned subsidiary Brightpoint Great Britain Ltd. (“Brightpoint”) as the sole distributor. The announcement is a result of Brightpoint’s recent successful acquisition of the wireless distribution business of Hugh Symons Telecom (HTC) in the U.K. www.brightpoint.com
Dialogic and OnMobile announce partnership
OnMobile Global Ltd. will become a customer for Dialogic Corp.’s MSP 1010 Multi-Services Platform and the IMG Integrated Media Gateway Platform. The companies will collaborate on leveraging Dialogic R&D and technology leadership into OnMobile’s deployments in global telecom value-added services, including the Indian market where OnMobile has a significant market share. Dialogic is a global provider of technologies for media and signal processing. www.dialogic.com
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ICN Wire 05.02.08
First Data announces plans to acquire InComm
First Data Corp., a global provider of electronic commerce and payment processing services, announced it has reached an agreement to acquire InComm, a marketer, distributor and technology innovator of stored value gift and prepaid products. Specific terms and conditions of the agreement were not disclosed. The acquisition is subject to customary closing conditions and regulatory approvals and is expected to be completed in the second quarter of this year. www.firstdata.com
Bell takes on new role at CPI Card Group
Bruce Bell was appointed Rocky Mountain Regional Sales Manager, Commercial Cards and Services at CPI Card Group, a plastic card manufacturer. Bell is responsible for sales and services to clients in the Rocky Mountain region for commercial card products. www.cpicardgroup.com
New UreLife card launches in the U.K.
The UreLife card, the U.K.’s first prepaid card to incorporate government-approved proof-of-age verification, launched on London's Oxford Street. The card combines prepaid Visa debit cards with color photographs of the cardholders and PASS (Proof of Age Standards Scheme) accredited proof-of-age hologram. The UreLife card is available for five age groups: 12-15 years, 16-17 years, 18-20 years, 21+ years and 60+ years. Cards are color-coded by age. www.urelife.com
CPI’s Meeker receives ACE certification
Guy Meeker, director of card manufacturing, was awarded ACE certification. The ACE examination evaluates skills and knowledge of card manufacturing professionals in eight key sections: PVC/Plastics, Inks, Adhesives, Printing, Collation, Lamination, Die-cutting and Standards/Testing. Applicants must be working for an ICMA member company and have a minimum of three years of industry experience. www.cpicardgroup.com
Viscom International signs agreement with Blackstone
Viscom International Inc., providers of prepaid products and marketing services for the Hispanic market, signed a partnership agreement with Blackstone. The two companies agreed to distribute Viscom prepaid phone cards in 6,000 Blackstone Touch-n-Buy interactive kiosks nationwide. Under the agreement, Blackstone will distribute Viscom’s BEST Mexico and BEST Mexico Celular prepaid phone cards in $5 denominations, as well as VicoTel prepaid phone cards in $3 and $5 denominations. www.viscominternational.com
Euronet’s Transact signs prepaid agreement with Aral AG
Euronet Worldwide Inc.’s prepaid subsidiary, Transact, signed a prepaid agreement with Aral AG, a German petrol station operator. Aral is a wholly-owned subsidiary of Deutsche BP AG, the German subsidiary of the British mineral oil group BP plc. Transact will be the technical partner providing electronic top-up solutions for prepaid mobile airtime and other predetermined prepaid products at Aral company-owned and franchised stations in Germany. www.euronetworldwide.com
SellingSource names Ron Kalb Director of Communications
Las Vegas-based SellingSource LLC named public-relations practitioner Ron Kalb Director of Communications. He will oversee corporate PR, communications and other marketing outreach activities for its 11 companies. SellingSource develops technology and marketing solutions for the specialty finance industry. www.sellingsource.com
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ICN Wire 4.11.08
ideaEDGE expands intellectual property portfolio
Prepaid gift card program developer ideaEDGE expanded its intellectual property (IP) portfolio by acquiring additional IP covering group gift cards and eCards. The Company is developing a new proprietary Social Network Enabled Gift Card (SNE Gift Card) platform that will enable multiple individuals to contribute to a group gift card. www.ideaedge.com
Pay Linx Financial enters into agreement with PDNB
Pay Linx Financial Corp. entered into an agreement with Palm Desert National Bank to issue a MasterCard branded prepaid card in the United States. Pay Linx is a third-party processor of these transactions. www.paylinx.ca
AT&T appoints new CTO
AT&T appointed John Donovan as chief technology officer. Donovan will oversea the company’s global technology direction and innovation road map, including product development, network and engineering operations, AT&T Labs, and the security and intellectual property organizations. www.att.com
Transcard to donate transaction fees in honor of Earth Day
Transcard will be donating 100 percent of all payroll card transaction fees on April 22 –Earth Day - toward Rain Forest Restoration Projects in the Amazon. Transcard launched a new division, Transcard Green, to develop initiatives such as these in the prepaid space. www.transcard.com
CardWare International announces multilingual communication capabilities
CardWare International introduced a new service for its customer service program. When CardWare places a call to someone or receives an incoming call, the individual will identify their native language and a translator will be added immediately to the conversation. Calls requiring translation services incur a minimal per-minute fee. The service covers more than 170 languages. www.cardwareinternational.com
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