Navigating Change....
The PELORUS Group
Market Research and Consulting Services

FOR IMMEDIATE RELEASE

Date: October 11, 2001
Contact:  Greggory S. Blundell
Phone:  908-707-1121
Fax:  908-707-1135
E-mail:  Info@pelorus-group.com

PELORUS GROUP PREDICTS PREPAID WIRELESS GROWTH

Raritan, NJ - Prepaid wireless is growing.  According to a new report from The PELORUS Group entitled “Prepaid Wireless!”, the success of prepaid wireless has been part of the embracing of mobile phone service around the world.  The market for wireless services has exploded to include over 131 million mobile phone subscribers in North America, including 109.5 million in the United States.  Mobile phone penetration has increased to over one-third of the US population, generating $52.5 billion in service revenues in 2000 alone.  Because of that overall wireless growth, prepaid wireless is poised to surge.

Several elements will converge to propel prepaid wireless.  Foremost are the new, more robust offerings that include digital services, enhanced features like Caller ID, as well as roaming and long distance.  Several packages now offer national footprints.  Benefits such as these are attracting new segments such as teens, young adults and occasional users.  Carriers are also benefiting from new prepaid platforms that provide greater efficiencies and flexibility in billing, account management and call handling.

Mark Thompson, Director of Research for The PELORUS Group, observes, “Currently, there are 19 million prepaid mobile users in North America, and we foresee strong future potential.  The real restraint on this market is the carriers themselves.  If they bow to pressure from stockholders and focus on ARPU and the risk of cannibalization, some may elect to drop out of the prepaid market.  If, however, they aggressively court new consumer segments such as the youth market, they could forge ahead and realize exciting revenue possibilities.

According to the report, in Mexico more than 70 percent of wireless users had prepaid contracts in 2000.  The penetration rates in Canada were much less than Mexico since prepaid is a newer offering.  Penetration reached about 20 percent in 2000.  The US market was the lowest in terms of prepaid usage, with only a 6.4 percent penetration level at the end of 2000.  That means room for growth, provided the right stimuli are introduced.

The PELORUS Group estimates that prepaid wireless users in North America will generate record revenues of nearly $10 billion in 2001, and foresees significant growth through 2005.