MetroPCS Dials Up IPO

source: FORBES.COM

link: http://www.forbes.com/2007/04/19/ipo-wireless-phone-tech-...




Burlingame, Calif. -

Upstart wireless carrier MetroPCS Communications showed Thursday that disrupting someone else's business is one thing. Making money at it, however, is quite another.

The Dallas-based company launched the biggest initial public offering of the year to date on Thursday by selling 50 million shares and raising $1.15 billion. MetroPCS (nyse: PCS - news - people ) shares, initially priced at $23, rose more than 18% to $27.

The secret to IPO success for MetroPCS? Profits, and a business model that relies on tweaking the phone industry, not revolutionizing it. The company has signed up 2.9 million subscribers for its flat-rate, unlimited use phone service. And it's making money by doing it, albeit just barely: For the year ending Dec. 31, the company posted net income of $29 million on revenue of $1.55 billion.

By contrast, two other recent telecom IPOs, Clearwire and Vonage, are pursuing far more ambitious plans--and burning serious amounts of money in the process.

Clearwire is looking to build a high-speed voice and data service based on next-generation wireless standard WiMax. Its shares have fallen 32 percent since its March IPO.

Similarly Vonage is taking on the phone companies with an Internet based calling service. Its shares are down nearly 80 percent since its IPO last year.

21:39 Gepost door Mobile blogger in Algemeen | Permalink | Commentaren (0) | Tags: metropcs, wimax, ipo, clearwire, vonage |  Facebook |

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