Cricket Wireless Sees iPhone Sales Plummet
February 28, 2013 8:21 AM
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Carrier could have $100 million worth of unsold iPhones by midyear
The iPhone 5 has been a
for most carriers around the world. However, Cricket Wireless – the no contract prepaid network operated by Leap Wireless -- isn't having luck selling the iPhone 5 and is seeing stock levels climb as consumers opt for other devices.
Leap Wireless says that it believes it will sell about half as many iPhones as it committed to sell during the first year of its contract with Apple, which ends in June. Leap Wireless believes that the poor sales could leave it with as much as $100 million worth of unsold iPhones by the middle of 2013.
Leap Wireless has 5.3 million subscribers and areas where it can sell the iPhone are limited by its limited network coverage. Leap was the first of the major prepaid carriers in the US to offer the iPhone last year.
Perhaps the biggest challenge facing Leap Wireless and other prepaid carriers who offer the iPhone is one of cost. While carriers that require a contract, such as AT&T and Verizon, are able to
subsidize the cost of the iPhone
making it significantly cheaper up front, Leap charges the full retail price of $500.
Considering that pre-paid carriers tend to attract customers shopping on a budget coming up with $500 could be a stretch for many subscribers leading them to “cheaper”, subsidized phones.
Wall Street Journal
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Hard for them to compete with the fraud they allow to occur
2/28/2013 3:31:50 PM
A big reason they aren't selling enough iPhones is due to the fact that they allow devices to be flashed to their network. A significant amount of fraud in my store is people using credit mules to purchase sprint iPhones and then never paying the bill. Within a few days the phones are flashed to cricket and sold on Craigslist cheaper than Cricket themselves. As long as Cricket allows this practice, they will have a tough time competing with fraudsters.
RE: Hard for them to compete with the fraud they allow to occur
2/28/2013 7:22:34 PM
This is quite true. All those poor people with iPhones that the Right likes to complain about are actually buying 'pre-used' devices on the secondary market and activating them on Cricket or MetroPCS. Some know that they are stolen, others do not.
"We basically took a look at this situation and said, this is bullshit." -- Newegg Chief Legal Officer Lee Cheng's take on patent troll Soverain
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