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Quick Google appears to show they have 3 million subscribers, which makes the average cost per customer to be $450. Given its a virtual network, beyond brand va

Quick Google appears to show they have 3 million subscribers, which makes the average cost per customer to be $450. Given its a virtual network, beyond brand value Ryan provides, who owns 25% of the company and will remain the brand’s spokesperson — what other assets are being transferred beyond a brand and portfolio of subscribers? If long term, it’s basically a subscriber list, seems like value of a virtual US telecommunications subscriber is roughly $45 a year — assuming sell is a 10x multiple. How would someone estimate this value beyond this specific sell? Even more abstract, is there a source for estimating value of a customer for a given market?

dougmwne 4y ago
I use Mint. The only reason I use it is because they are a price leader for the whole industry. They run regular promotions and I get service for about 8 bucks a month. I have been cycling through their new customer promotions for years. My actual phone number is with a voip service so all the numbers I get from Mint are burners. $450 to acquire me when I was already paying wholesale rates to t-mobile? Wow, what a scam.
- theGnuMe 4y ago
  That sounds like a lot of work...
  - dougmwne 4y ago
    It is not. Every 6 months, I type back in my credit card number tap a button to load the eSim. Literally nothing else I have to do. I also can let my service lapse when I am not in the country.
- jmull 4y ago
  The number of people working the new customer promotions like this is probably insignificant.
mdasen 4y ago
Dish bought Boost from Sprint/T-Mobile for $1.4B with around 9M customers, but that was also part of a sweetheart deal to get the T-Mobile/Sprint merger approved. $1.35B for 3M customers is basically 3x more expensive, but I think there are some differences. 1. It's not a sweetheart deal. You can't really compare T-Mobile being willing to throw away a billion or two in order to close a deal worth maybe $90B. 2. It's a 61% stock purchase. T-Mobile's stock has been flying high and even if you're bullish on T-Mobile US as a company, it's now worth 14% more than Verizon and 36% more than AT&T. T-Mobile has some advantages in its spectrum portfolio and its 5G lead, but Verizon and AT&T also have a lot of owned fiber that T-Mobile doesn't have and a lead on rural coverage. The point is that I think T-Mobile's stock is likely a bit high and that means that they're partly buying Mint at a discount (by trading slightly over-valued stock instead of cash). Maybe the real value of the deal is only $1-1.1B. 3. It comes with Ryan Reynolds as a spokesperson. Boost didn't come with that. 4. Boost's 9M customers came with the costs of an extensive retail presence. Mint's 3M customers come from a low-touch model that saves a lot of money. T-Mobile is adding 3M customers without adding a large retail cost. 5. This also gives T-Mobile a new go-to-market - the low-touch, store-less go-to-market. That's valuable and they're able to do it with a brand that has gotten traction in that area and without risking their T-Mobile or Metro brands. 6. It's a differentiated offering - specifically offering both limited data plans (which they don't want to emphasize on their T-Mobile or Metro brands) and multi-month or yearly prepaid plans. 7. Mint seems to be a growing brand while Boost was already having problems when T-Mobile was selling it off. T-Mobile sold 9M customers to Dish, but even after Dish bought Republic Wireless, Ting Mobile, and Gen Mobile, they're down to 8M customers. In the video, Reynolds talks about being on T-Mobile's network as a key to their success. It's a bit of puffery, but being on Sprint's network definitely left a lot of Boost customers unhappy and hurt the brand. The point being that buying a brand that has a good reputation and a customer base that seems happy is more valuable than buying a brand that customers aren't happy with that has really high churn. It does seem a bit expensive, but I'm guessing some of these factors went into the price.

dougmwne 4y ago

I use Mint. The only reason I use it is because they are a price leader for the whole industry. They run regular promotions and I get service for about 8 bucks a month. I have been cycling through their new customer promotions for years. My actual phone number is with a voip service so all the numbers I get from Mint are burners. $450 to acquire me when I was already paying wholesale rates to t-mobile? Wow, what a scam.

theGnuMe 4y ago
That sounds like a lot of work...
- dougmwne 4y ago
  It is not. Every 6 months, I type back in my credit card number tap a button to load the eSim. Literally nothing else I have to do. I also can let my service lapse when I am not in the country.
jmull 4y ago
The number of people working the new customer promotions like this is probably insignificant.

mdasen 4y ago

Dish bought Boost from Sprint/T-Mobile for $1.4B with around 9M customers, but that was also part of a sweetheart deal to get the T-Mobile/Sprint merger approved. $1.35B for 3M customers is basically 3x more expensive, but I think there are some differences. 1. It's not a sweetheart deal. You can't really compare T-Mobile being willing to throw away a billion or two in order to close a deal worth maybe $90B. 2. It's a 61% stock purchase. T-Mobile's stock has been flying high and even if you're bullish on T-Mobile US as a company, it's now worth 14% more than Verizon and 36% more than AT&T. T-Mobile has some advantages in its spectrum portfolio and its 5G lead, but Verizon and AT&T also have a lot of owned fiber that T-Mobile doesn't have and a lead on rural coverage. The point is that I think T-Mobile's stock is likely a bit high and that means that they're partly buying Mint at a discount (by trading slightly over-valued stock instead of cash). Maybe the real value of the deal is only $1-1.1B. 3. It comes with Ryan Reynolds as a spokesperson. Boost didn't come with that. 4. Boost's 9M customers came with the costs of an extensive retail presence. Mint's 3M customers come from a low-touch model that saves a lot of money. T-Mobile is adding 3M customers without adding a large retail cost. 5. This also gives T-Mobile a new go-to-market - the low-touch, store-less go-to-market. That's valuable and they're able to do it with a brand that has gotten traction in that area and without risking their T-Mobile or Metro brands. 6. It's a differentiated offering - specifically offering both limited data plans (which they don't want to emphasize on their T-Mobile or Metro brands) and multi-month or yearly prepaid plans. 7. Mint seems to be a growing brand while Boost was already having problems when T-Mobile was selling it off. T-Mobile sold 9M customers to Dish, but even after Dish bought Republic Wireless, Ting Mobile, and Gen Mobile, they're down to 8M customers. In the video, Reynolds talks about being on T-Mobile's network as a key to their success. It's a bit of puffery, but being on Sprint's network definitely left a lot of Boost customers unhappy and hurt the brand. The point being that buying a brand that has a good reputation and a customer base that seems happy is more valuable than buying a brand that customers aren't happy with that has really high churn. It does seem a bit expensive, but I'm guessing some of these factors went into the price.