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Affordable Connectivity Program fuels prepaid growth — Moore

The Affordable Connectivity Program (ACP) is a huge factor for the prepaid ecosystem. While at the All Wireless & Prepaid Expo in Las Vegas in August, a veteran telecom executive commented to me that in the coming years, the two top sources of funding for this ecosystem will be the Total by Verizon store rollout, which is huge, and the ACP. I realized that he was right.

My two top takeaways from the Expo were about how real and huge the Total by Verizon store rollout is and how important the ACP is to the prepaid wireless ecosystem.

The ACP had 20.7 million household enrollments as of September 4, up from 13.6 million household enrollments as of September 5, 2022. There are 124 million households in the U.S., so nearly 17% of U.S. households are connected via the ACP. Some 53.8% of the total are using wireless carrier networks, while 45.3% are using landline broadband, the FCC recently reported. Fixed wireless and satellite lines comprised 0.9% of the total.

The ACP was huge at the All Wireless & Prepaid Expo

These numbers are public, so it is no secret how prevalent the ACP has become. That said, it was clear to me at the All Wireless & Prepaid Expo how high the interest is in executing on the ACP.

At the Expo, we had a conference session with four ACP experts, including Robert Yap, founder of Gen Mobile and VP of Dish Network. Also on the panel were Chuck Campbell of CGM, Calen Schultz of Community Outreach Partners and Bud Torcom of Mazama.

The session was well-attended, with very few open seats. I cannot recall ever being at a conference session with more questions from the audience. Fortunately, the amount of expertise that these four executives brought to the table was at the highest level. In fact, the interest level was so high that I let the session extend 20 minutes into the lunch hour. It seemed like no one wanted to leave the room.

Carrier interest and ecosystem developing

Gen Mobile had a large presence at the Expo, including two large booths and a speaking presence by founder Robert Yap at two conference sessions. This Dish-operated MVNO is heavily focused on ACP and Lifeline-related sales.

Another MVNO told me it had plans to push free services via the ACP, while providing refurbished devices to these customers either for free or at very affordable prices. Qualifying customers will be able to walk out of the store with a free used iPhone and free service.

There were numerous questions during the ACP session. It was not always clear who the questioners were, but I could sense that dealers and carriers had gears turning in their heads about how to up their ACP game. Numerous business cards were exchanged at the end of that session.

An example of the developing ACP ecosystem was the presence of CGM. CGM provides an ACP enrollment platform and a “suite of support services,” which is intended to “expedite an ACP carrier’s time to market, optimize their subscriber retention, and drive end-to-end program compliance.” CGM had a booth on the show floor and its CEO, Chuck Campbell, spoke at the conference.

Legal status of the ACP

ABC News in August reported about the tenuous nature of ACP funding. “Its primary source of funding, a $14.2 billion allocation, is projected to run out by the middle of 2024,” per the report. That said, the program is known to have support on both sides of the aisle. The ACP was launched during the Trump Administration and has the support of the Biden Administration.

Sign for ACP-based service at $0/month as seen at a California Boost store in March. (Wave7 Research)

The ACP at retail

The ACP is heavily pitched via prepaid retail. Banners are seen at some Cricket Wireless stores pitching “talk, text & fast 5G for as low as $0/mo.” Boost Mobile has signs at stores pitching “free mobile service” and many Boost Mobile dealers are holding street events making this pitch. Metro by T-Mobile has even used the ACP discount to pitch a bundle of its $40/month mobile plan and $50/month T-Mobile Home Internet service at $60/month, following a $30/month ACP discount.

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