Succumbing to marketplace pricing pressures, Omnipoint Communications Inc. began offering bundled-minute pricing plans and new prepaid packages last week.
“This is the first major pricing change we’ve made since starting business in New York,” said Omnipoint President George Schmitt in a press conference. “We need to remain competitive in the marketplace.”
Omnipoint, which has long avoided offering bundled-minute pricing plans, has been testing bundled-minute pricing in Miami. During the test, use increased by 50 percent compared with the company’s other markets, and average revenue per user exceeded $60 compared with the company’s average of $54, said Omnipoint.
New York-based Toronto Dominion noted Omnipoint’s effective per-minute rates in its mid-Atlantic and New York metro markets were near the high end of both competing cellular and PCS rates for low, medium and high levels of usage.
The new bundled-minute packages, called Custom-Tailored Wireless, vary in Omnipoint’s markets, but range from 20 or 30 minutes of local calls for $20 to an unlimited-minute pricing plan at $300, previously priced at $500. For an additional monthly fee, Omnipoint customers can upgrade their bundled-minute plans to be used for domestic long distance as well as local calls. In New York, for example, customers pay $80 for 500 minutes and an additional $15 for the long-distance service upgrade.
The company also has reduced roaming rates to 49 cents per minute as well as lowered prices for data services.
Omnipoint’s No-Fee Prepay option eliminates a monthly service fee, flat-rate pricing and automated account management. Each region offers three prepay options that include bundles ranging from 70 to 600 minutes. As minutes are used, they are deducted from the customer’s account. Purchased minutes expire after 60 days.
Schmitt also squashed rumors that indicated Omnipoint’s reseller, Urban Wireless, was planning to file for bankruptcy.
“We’ve been in discussions with them about changing the business relationship from a reseller to something else,” said Schmitt. With the new pricing plans, “it becomes more difficult for them to make their business model work.”
