FreedomPop Generating Revenue From Almost Half Of Its British Users
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FreedomPop a freemium Sprint MVNO that also offers global GSM service through various partners is reporting that almost half of its British users are paying for optional services in addition to its free voice and data plan.
FreedomPop's CEO Stephen Stokols says that the conversion rate in the UK of those that switch from free to paid services has reached 48 percent. Stokols says that this rate is higher than what messaging service WhatsApp and streaming service Spotify convert at. The UK subscriber count is said to be "at six figures."
FreedomPop launched in Britain lasts September and has plans to launch in Spain next month after recently securing $109 million in funds from venture capitalists, bringing total funding to $190 million. The company hopes to add a second US wireless network soon, which will presumably be T-Mobile, and to make its first net profit by the end of 2016.
Over a year ago FreedomPop was in talks with Sprint about the possibility of being acquired, although the deal has since fallen through. Sprint was interested in using FreedomPop's technology to help bring down its own costs and thus the costs of its plans to compete better with the rest of the big 4 networks. FreedomPop's technology allows it to analyze its users behavior which it in turn uses to send them targeted offers for paying for extra services such as data and multiple phone numbers.
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Stokols still claims that Sprint is "making a ton of money" off of FreedomPop as Sprint gets to gain more customers without having to deal with customer acquisition or service costs. Meanwhile, FreedomPop is the one taking all of the risks if their model doesn't work. With the recent influx of more venture capital, FreedomPop continues to risk a lot in the name of growth and profitability.
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