Leap Won’t Exactly Leap to LTE

Updated. Leap Wireless, the company behind the prepaid Cricket prepaid service, will transition to a 4G Long Term Evolution Network in the second half of this year, but is dubious about the technology being ready for consumers. In an interview with Mobile World Live, Leap (s leap) CEO Doug Hutcheson, said the operator believes the mass market won’t adopt LTE until the latter half of 2012 when devices hit “critical pricing.” That makes sense, given it’s when a greater number of handsets and other devices will have the technology and more of the population will be covered by LTE networks.
Hutcheson said Leap has the spectrum needed to deploy LTE; however it may not be the type of LTE network that many consumers think of when they consider the technology (if they ever actually consider it at all). Less spectrum means the capacity on the network is limited, so Leap’s LTE may look more like Metro PCS’ LTE offerings as opposed to Verizon’s (s vz). Kevin broke down some of the differences on the consumer side here — namely slower surfing speeds for MetroPCS (s pcs) but decent video capabilities on both networks.
Leap apparently isn’t in a hurry to deliver 4G, because its customers apparently are so excited about current smartphones and 3G service at the moment. Hutcheson said in the fourth quarter, over a third of the devices Leap sold were smartphones. He also said margins rose as the average revenue per user increased by up to 15 percent, and churn dropped. Since running low-cost networks are essential to pre-paid operators’ profits, Leap has to walk a fine line between keep customers happy and not upgrading to early before Leap can recoup the investment.
Ed.: Doug Hutcheson’s name was spelled incorrectly in a previous version of this article.