Cricket Communications' unlimited music download service, Muve, has blossomed since it sprouted 18 months ago and will expand in another month outside the U.S., a Cricket executive said Tuesday.
About 1.4 million out of 5.5 million Cricket customers use the service, paying for unlimited voice, data and text as well as unlimited music downloads -- all starting at $50 a month on Android and BlackBerry phones.
"Listening to music on a wireless device is not unique at all, but our business model is unique," said Bill Ingram, executive vice president of strategy at Cricket. Muve (pronounced Moov) has been the fastest growing music subscription service in the U.S. and now accounts for 80% of all music played on smartphones there, aside from songs downloaded via Apple's iTunes, Ingram said.
The expansion to an unnamed country on another continent will be announced in another month, Ingram said in an interview. Customers will connect to Cricket's data center in Dallas for their music downloads, using satellite and cable connections. Cricket's core network and data center run on Cisco gear, and Ingram spoke on a Cisco panel at Mobile World Congress (MWC) here about Muve's success.
Six other carriers around the globe are also interested in Muve because of the unique business model that helps retain customers and generate additional revenues. Cricket is considering licensing the service to other carriers, but hasn't reached a final decision on doing so.
Ingram explained that Muve users can download an unlimited number of songs, which are kept on the smartphone to be played later rather than streamed each time. The average song is about 800 KB, and an average user downloads about 800 songs in their first month -- less than 1GB. In the second month, the average number of downloads declines to 300 songs, and then down to 50 on average in the following months.
At that point, customers "keep paying us, in effect, without using the network," Ingram said.
If a user turns off the service, the music on the phone is disabled, but if a customer returns to the paid service, he or she "gets all the music back, since the playlist is kept in the cloud."
The unique business model helps retain customers "which is a huge value for a carrier," Ingram said.
Since customers don't pay 99 cents or more per song as they do on iTunes, Cricket's success with Muve has nothing to do with the popularity of a given song or artist. "It's optimized as very efficient," Ingram said.
Overall, Muve won't lead to terrific growth for Cricket, but does help to retain customers, Ingram said.
Ingram conceded that with about $3 billion in revenues annually and 5.5 million customers, Cricket is a fraction of the size of AT&T or Verizon Wireless. "That means in the U.S., we need to be very nimble and figure out ways to out-do AT&T and Verizon," Ingram said.
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