Last week on CNN.com Tech I wrote a story about an interesting new offer from MetroPCS:Â No-contract smartphone may lure first-time users. In a nutshell, this discount carrier (which is one of the most popular carriers here in Oakland, CA), which previously has offered only feature phones and low-end BlackBerries, is starting to offer an unlocked smartphone running Android 2.2 under an affordable no-contract plan: $50/month for 1GB data, and $60/month unlimited data. (Plus unlimited talk, text, etc. on both plans.)
This is not the first discount wireless carrier to offer a no-contract smartphone. But it is the first such offering from a carrier that has already rolled out its high-speed LTE network in 13 metro areas. Â And here’s why that’s interesting in terms of business strategy, and for consumers…
Even though this phone (The Samsung Galaxy Indulge) costs $400 up front (which is expensive compared to subsidized smartphones, but pretty cheap for a new unlocked Android phone), I suspect many people will be tempted to get this as a first-time smartphone because the monthly costs will be manageable and predictable, there’s no contract commitment, and no early termination fees. Plus they’ll be on a faster network than most other carriers can currently offer.
I mention in my CNN post a tidbit I picked up from CNET: MetroPCS never really had a 3G network, which is partly why they’ve had a reputation as a crappy carrier. But this company is rolling out LTE faster than any other US carrier — and they can do this largely because they did not invest in 3G.
Meanwhile, the major carriers are having to face the expense and considerable time and effort to install LTE networks. Also, their 3G networks are only a few years old, and they’ll need to keep those in service for a few more years, until LTE-enabled phones become the norm.
MetroPCS seems to be leapfrogging ahead of the major carriers in terms of US network technology. It reminds me of how cell phones took off so fast in rural Africa, India, and Asia, where landline networks never really got widely built out in the first place.
Sometimes not being an early adopter can be a good thing.