Virgin Mobile USA Inc. is set to announce Thursday that it is slashing the price of its unlimited calling plan to $50 from $80 per month, a result of fierce competition and price-cutting among second-tier cellular carriers. The drastic price cut at Virgin, which has 5.4 million subscribers, is a sign of the continuing disruption caused by MetroPCS Communications Inc. and Leap Wireless International Inc., which both provide unlimited prepaid service for $35 to $50 per month in limited areas. MetroPCS has been expanding recently into big markets in the Northeast, like Boston and New York. In January, national carrier Sprint Nextel Corp. introduced a $50 unlimited plan under its own prepaid brand, Boost Mobile, to counter that threat.
Virgin Mobile spokeswoman Jayne Wallace said its price cut is "definitely a response to the marketplace." The company uses Sprint's network to provide service and recently renegotiated its rates, enabling it to lower prices while getting a chance to improve its financial performance, she said. The new plan becomes available on April 15. Current customers with the $80 plan will have to contact the company to switch over to the $50 plan, Wallace said. As at Boost, MetroPCS and Leap, Virgin Mobile's monthly plans have many of the features of plans at major carriers but don't require contracts
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