FreedomPop, a US telecoms firm that offers free 4G service, has entered the UK market, bringing competition to firms like of TalkTalk and Tesco Mobile, who are budget providers. FreedomPop’s settling in the UK marks the beginning of their international expansion plan that is venture capital-backed. After the payment of a one-off fee of £7, FreedomPop provides a monthly service consisting of 200 minutes of talk time, 200 texts and 200MB of mobile data. A market survey will also be presented to the subscribers and upon completion of the survey, the subscribers earn more free allowances. The company is a Mobile Virtual Network Operator and does not infrastructure such as mobile masts. It also aims to target the market segment that is conscious about prices. FreedomPop will buy capacity to provide to its subscribers from the Three network. According to Stephen Stokols, the Chief Executive, only half of the subscribers in the US buy extra capacity. He went on to state that the company only requires 50,000 initial subscribers. This will aid the company to be cash flow positive in the UK.
FreedomPop was founded in 2011 in the US by Stephen Stokols. This was after a proposal was rejected by BT to launch in the UK on itunes.apple.com, the firm at the time headed by Gavin Patterson. Mr. Patterson acted as an advisor to FreedomPop but has had to abandon this of late as the company would compete directly with BT’s own mobile operation in the UK. BT in March rejoined the mobile market, pricing its products radically and beating expectation. BT later paid £12.5bn to buy out EE.
FreedomPop is intent on reducing costs by spending as much traffic as possible over wifi networks as opposed to mobile networks. Mr. Stokols confirmed that would leave for the UK later on to try and enter into a contract with BT, his former employer, to strike a deal for access to the wifi network belonging to BT. Initially, FreedomPop will register its users online only, but Mr. Stokols confirmed that they were holding negotiations with two firms which are major high street retailers. The company goes ahead to claim that about a quarter million Britons showed expectation before the commercial launch and the company may have to put a limit on subscriptions in the first few months in order to manage its own growth.