AT&T Lifts Speed Caps for Its Prepaid Cricket Wireless Customers

(Bloomberg) -- AT&T Inc. will no longer limit connection speeds for its Cricket Wireless prepaid customers, a small sweetener in a series of efforts to attract subscribers at the lower end of the mobile market. 

The Dallas-based phone giant, which started giving the top tier of its Cricket customers free HBO Max two months ago, said Friday it is also including 5G network access for its prepaid customers, matching offers by T-Mobile US Inc.’s Metro service and Verizon Communications Inc.’s Visible venture.

AT&T previously kept its lower-tier Cricket customers at an 8-megabit-per-second speed limit. Typically, activities like video gaming or high-definition video streaming work best when speeds are 10-megabits-per-second or faster. 

Carriers have been offering streaming freebies like Netflix, Disney+ and Amazon Prime along with free phones to fuel a surge of new regular monthly wireless subscribers. As the competition heats up, the industry is looking for more growth in riskier areas like low-credit customers who have to pay for service in advance. 

The prepaid market is about to change dramatically if Verizon can close its pending $6.9 billion takeover of Tracfone and add those 21 million subscribers to its ranks. As of August, AT&T had 18.7 million prepaid customers, including 12.4 million Cricket subscribers. T-Mobile has 20.9 million prepaid customers, mostly under the Metro brand. Verizon had 4 million. 

The prepaid market includes a wide range of people, many young or poor who don’t have a strong credit history. While there are higher risks of nonpayment and less loyalty than among regular subscribers who pay bills at the end of the month, the prepaid market has also been one of the biggest pipelines for customers upgrading to higher-priced plans. 

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