Q&A: FreedomPop CEO and Founder Stephen Stokols

Stephen Stokols is CEO and Founder of FreedomPop, a US-based MVNO that offers free mobile services, including mobile data, text and voice services.

Eurocomms.com: How does FreedomPop’s business model work?

Stephen Stokols: We use a freemium model. Similar to Spotify or Dropbox, we make money on value added service upsells - for example, international calling, having a second international number, online security or data rollover - and larger data allotments for heavier usage users.

You are launching in the UK – when will this happen exactly and what sort of packages will you be offering customers when you do?

We will launch our service later this summer. UK subscribers will receive 200 megabytes of data, 200 voice minutes and 200 texts free each month via the FreedomPop app or SIM card.

Paid plans will be priced between 15 percent and 40 percent under market alternatives.

Users will also be able to purchase value added services such as rolling over unused data or a second international number for friends and family in another country to call free.

Further, users will be able to make unlimited calls and texts to other FreedomPop customers, including those in more than 60 other countries.

What sort of take-up are you hoping for?

We’re on track to hit one million US users and we hope to hit the same milestone in the UK in the next year to 18 months.

“Free” is a universal value. UK residents love value as much, if not more than, Americans.

Tell us about your relationship with Three UK…

Our agreement is with X-Mobility, a Mobile Virtual Network Aggregator (MVNA) for Three UK, to deliver FreedomPop services in the UK. Through its wholesale relationship, X-Mobility will provide access to its network for FreedomPop UK users.

Is M&A activity in the UK any cause for concern? For example, how would the proposed merger of O2 and Three impact FreedomPop?

FreedomPop targets competitive markets where users are not tied in and open to switching. No telco has the Internet capabilities and model of FreedomPop to compete with “free” and make it work economically so mergers are not a primary concern. Facebook entering market might be.

What are the main obstacles you expect to face launching in the UK?

Operational and product experience are the biggest challenges to overcome.

Are you currently in discussions with any other European telcos in regards to launches, and if so who?

Yes, we are in discussions but can’t provide any specifics now. We plan to expand to five other countries within the next year.

You’ve said previously that you turned down offers from companies trying to buy you out. Why did you turn them down?

Before we decided to pursue funding, we had M&A offers from several companies. We ultimately believe we can drive significantly more value going it alone. Our investors believe we can continue our growth and success and we do too.

The EU plans to scrap roaming fees by 2017. As a provider of free roaming, do you expect this to impact your business in any way?

Not really. We are not competing on roaming as a differentiator. Our focus is competing on unprecedented value.

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