Verizon grows prepaid but sticking to “bread and butter”

January 26, 2010

verizonwirelesslogoVerizon Wireless brought in almost half of its customers from its wholesale prepaid business in the fourth quarter, seemingly confirming analyst predictions that this market segment is becoming the biggest driver of mobile.

But Verizon is careful to downplay the importance of any services other than its lucrative postpaid services for high-value monthly bill paying customers.

“That’s our bread and butter. Our real focus is the retail postpaid base,” Chief Financial Officer John Killian told Reuters.

“In the quarter we did see good reseller activity from several different resellers,” he said, but noted that this could be a high point for the year.

“I don’t think we’ll have as strong a number as we’ve had in the fourth quarter but we might continue to see some growth. We hope to see some growth from the reseller base because they’re profitable to us and they’re good customers.”

Still, while wholesale “might be a little bit bigger” in the years to come, he said more than 90 percent of its busines will be retail postpaid. “That’s not going to change any time soon.”

He added, “I think our most important customer base will always continue to be the retail pospaid customer base. To the extent we have the ability to grow wholesale more we’ll take advantage of that.”

Killian would give no word of course on whether Verizon customers will get their hands on Apple’s iPhone or its tablet computer, expected to be unveiled Wednesday Jan. 27.

One comment

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I don’t know, all indications are that the growth is going to come from prepaid providers (most of them wholesale resellers). Market saturation and greater competitiveness among prepaid carriers are going to make it increasingly difficult to hang on to those contract customers.
Heck, I even switched over myself just the other day. I now use NET10, a very reliable but inexpensive provider. Coverage in some areas where I travel actually seems to be better than before but I spend less than half of what I used to per month.

Posted by CarolBl | Report as abusive