MobileX CEO Peter Adderton doesn’t mince words when he talks about how people are when it comes to choosing their wireless plans.
“Consumers are dumb,” said Adderton, adding that carriers have convinced them they need overpriced unlimited data plans in case they go over their limit. “They never go over.”
Adderton knows a thing or two about shaking up the wireless industry. He founded Boost Mobile in Australia in 2000, and a year later created Boost in the US, where it remains a significant prepaid wireless provider now owned by Dish Network.
He’s back at it with a new venture, MobileX, which made headlines last month after launching a “$4.08” plan with Walmart. His mission is to get consumers to understand just what they’re paying for – even if it means paying MobileX less.
“I want to be completely transparent and honest,” Adderton said in an interview with Cord Cutters News. “I want to give customers complete control of what they want to use.”
MobileX hopes to stand out in a crowded field of prepaid wireless players, which include AT&T-owned Cricket, T-Mobile-owned Metro and Mint, Verizon-owned Tracfone and independent players like crypto-based Helium Mobile or cable-run Spectrum Mobile. That starts with its uniquely structured plans, which is why it starts at the odd number of $4.08. Customers can build plans based on the amount of data they use, either paying per gigabyte or opting for “unlimited” with a set number of guaranteed high-speed data. You tack on additional services like voice and text messages for an additional fee. (Check out our breakdown of the plans here.)
“It’s innovative and different — especially when most (mobile virtual network operators, aka wireless resellers) lead with price.” said Will Townsend, an analyst at Moor Insights & Strategy.
What also sets MobileX apart is its use of artificial intelligence to track and build out a model of what your data usage looks like, based on your first 10 days of service. It uses that data to recommend which plan you need, whether it’s paying per gigabyte or one of its “fake” unlimited data plans, which get throttled after a certain threshold.
The point of all of this is to educate consumers on how much data people actually consume, Adderton said, arguing that most folks use a lot less data than they realize, partly because they’re on a Wi-Fi network for the better part of the day.
North American smartphone users, on average, consumed about 17.4GB of data a month in 2022, according to Statista. But Adderton said that average is skewed by a minority – about 30%, he guesses – that consumes a massive amount of data.
He said that if MobileX’s AI system detects that someone is a power user, it will recommend a number of different carrier options, whether it’s from T-Mobile, Verizon or another service.
But for those who stick with MobileX, Adderton said that one of the biggest benefits is the ability to switch your plan on the fly, or have unused data roll over to the next month. The $4.08 plan, which seems pretty impractical as a primary phone line for many, could be applied to a 5G-enabled iPad, or serve as a back-up emergency line in case the primary phone doesn’t get a signal.
MobileX’s service runs on top of Verizon’s network.
The service will actually ping you if you’re using too much or too little data, prompting you to change plans up or down accordingly. That includes if you’re paying too much, Adderton noted. You’re also able to change the quality of your video stream, alternating from as low as 480p to 4K, to further help manage your data usage.
The question is whether people will care. Some savvier consumers may be willing to do the homework on how much data they use, but that’s likely a niche audience. “I suspect that many consumers will prefer to lock in consistent pricing by picking an unlimited service tier,” said Avi Greengart, an analyst at Techsponential. “But if you really don’t use much data and you’re willing to let MobileX show you that you likely don’t need an unlimited plan, the service can definitely save you money.”
While the service really just kicked off with the Walmart announcement last month, Adderton said the average usage on the unlimited data plan is between 8GB and 10 GB, while the average usage on the custom plans is around 3GB. Users on the AI-recommended plans use an average of 4GB of data.
“Our ARPU (average revenue per user) is significantly lower than anyone else in the marketplace,” he said.
Still, MobileX isn’t immune to the tropes of the wireless industry, including its “unlimited” plans. It’s the type of plan that is only unlimited because the service is significantly throttled down after a set amount of data. In MobileX’s case, it’s either 5GB or 30GB. But even Adderton calls them fake, and said he only uses the term because that’s what the market – and consumers – expect. But changing that dynamic is partly why he got back into the mobile business.
“What we’re trying to do is re-educate the customer,” Adderton said.