Leap Wireless launches unlimited messaging and data plans

Following the all-you-can-eat model it pioneered when founded, Leap Wireless today said it is converting all of its Cricket data and messaging plans to unlimited usage, discarding any bucket or pay-as-you-go options from its service menu.

Now, every single one of Cricket’s plans contains unlimited SMS, MMS and instant messaging, as well as local calling minutes. Starting at $35 a month, the plans scale upwards adding unlimited long distance, mobile Web access, directory assistance and basic features like voicemail, call waiting and three-way calling as customers move up the plan tiers. The only service Leap is not offering at unlimited basis at some level is roaming. Leap executive vice president of sales and marketing operations Al Moschner said the high cost the nationwide carriers charge for roaming limits Leap from offering unlimited buckets of roaming minutes, but in every other service category it believes it can spur usage by offering all-you-can eat plans.

Moschner said Leap has found in customer trials that once per-minute, per-MB and per-message charges and limitations were removed from data plans, customer adoption surged as customers didn’t have to constantly monitor their minutes or online activity.

“Once you take that anxiety out of the equation you get more usage from customers,” Moschner said. “Our customers tend to be pretty heavy communicators as it is. We felt it was time to take our data plans to the next level.”

Surprisingly Leap did not simply raise the monthly fee of its plans to implement the unlimited access feature. Its Basic Unlimited plan is still $35 a month even though unlimited messaging is now included instead of costing an additional surcharge. Moschner said Leap has been enjoying continued marginal profitability at all plans and is re-investing that money into its basic plans, choosing to spur customer growth rather than boost individual customer ARPU at the low-end. As a result, Leap hopes to see higher penetration in its markets spread throughout the southeast and southwest.

Leap is also just embarking on what it hopes to be a massive expansion plan. In the Advanced Wireless Services auction last year, Leap won licenses covering the Midwest and Great Lakes regions, allowing it to expand its spectral footprint to 100 million pops, including large Midwestern cities like Chicago. Moschner said Leap is already sufficiently funded to build networks covering 24 million people in those new regions, and it eventually plans to build out markets cover another 25 million after gaining additional funds, either through borrowing or revenue growth.

Moschner said it has already discussed the network build with its vendor partners, who have all agreed to provide network infrastructure at the 2.1 GHz and 2.3 GHz AWS bands as well as handset vendors to design dual-band CDMA devices for the PCS and AWS frequencies. “Now it’s just getting Qualcomm to build the chipsets,” Moschner said.

Leap is helped by the fact that several other CDMA carriers won licenses in the spectrum auction, particularly Verizon Wireless and fellow regional carrier MetroPCS, which won licenses in New York and the northeast. All of those carriers will create the economies of scale necessary to deploy equipment at lower costs. The biggest obstacle facing an immediate launch is spectrum clearing, Moschner said. The frequencies are all used by government agencies today and they have three years to clear out, but the government provided some of the funds raised by the auction to help them move to frequencies and upgrade their radio networks. Moschner said that those expedited deadlines will allow Leap top get its first networks online by early 2008.