Hop-On Actually Delivers A Phone?
from the yes,-but-to-an-unnamed-store dept
Hop-On Wireless has always been good at getting press for their idea of the "disposable" mobile phone. Of course, not all of that press has been good. Nearly two years ago, we covered the story of how the company seemed to be something of a fraud. The phones they were showing were simply repackaged Nokias (Nokia was not happy), they were announcing "deals" with major retailers after a single meeting with those retailers (many of whom said they had no interest in the product), they hadn't filed tax returns in years, and the company founders were charged in a scam for "fleecing investors out of as much as $20 million." Yet, the press mostly ignored those "faults" and focused on the idea of the disposable phone - which still didn't actually exist (despite promises of coming to the market in 2001). Time Magazine even declared the vaporware phone to be a "Product of the Year". Then, a year ago, Hop-On's CEO was arrested for a similar fraud, where he pretended to run a gambling website, and simply modified some other company's website, and used it to raise millions of dollars from unsuspecting investors. So, consider me skeptical when I read yet another story saying that Hop-On has come out with new disposable phones. Maybe the company has changed, but without more proof, it pays to remain skeptical. Admittedly, they appear to have a new CEO - but they still can't name any retail partners. The best they come up with is "a national drugstore chain". And, of course, none of this takes into account the very important question of whether or not there's actually a market for a disposable mobile phone. Of course, that question doesn't really matter if there's no real phone to sell.
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Also doubtful of market
Fast forward a few years and I am in a Sprint store signing up for new service. In the 30 minutes I was in there, I saw no fewer than a dozen people come in and feed cash into a machine inside the store. I went over to see what it was (a "reverse" cash machine?!) and found it was a unit that accepted cash payments for people to "pre buy" minutes. Sprint basically gives the phone away for free and customers pre-pay for minutes with cash (at a higher rate than people like me with contracts).
This "pay as you go" model services the needs of the largest segment that is pitched for disposible phones, which is the "low end" of the market, people without good credit, who don't have checking accounts, etc. Even the other markets that could be served (I am in town for a few days and need a cellphone) are serviced with other products and services, so the reputation of the company aside, I would want to take a good hard look at the business model before believing this will go anywhere.
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Timing of disposal
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MLO
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