Cricket Wireless 2012 Annual Report Download - page 5

2012 YEAR IN REVIEW 3
Our financial focus remains on driving our revenue
while improving operating efficiencies and
managing costs across the business, all with the
goal of achieving free cash flow.
lifetime value. We also continued to de-emphasize our Broadband product in order to
focus on higher margin smartphones, although we will sell through the existing inventory
of broadband modems in our sales channels. In both cases, we continue to support our
current daily PAYGo and Broadband customers.
We also made changes in our leadership team, appointing Jerry Elliott as chief financial
officer last May and then as president and chief operating officer in November. During
the year we also welcomed Rob Strickland as chief technology officer and Perley
McBride as chief financial officer. In addition, we promoted Rob Irving to the role of chief
administrative officer and Anne Liu to chief accounting officer. I believe we now have the
right team in place to address our challenges and realize the opportunities ahead.
STRENGTHENING OUR FOUNDATION
Our entire organization is focused on one thing: strengthening the foundation of our
business. Our focus on the customer experience is designed to retain and expand our
current customer base and position us to attract post-paid customers – all fueled by
making smarter investments.
We remain committed to serving those customers who got us here by delivering the best
total value in wireless and to expanding our base through programs like Cricket Lifeline
Credit. At year end we had more than 440,000 customers receiving a Lifeline credit, a
government assistance program that offers monthly credits to qualifying low-income
customers. Lifeline offers savings to those who need it most while attracting customers
who stay with us significantly longer, bringing us nearly twice as much lifetime value as
non-Lifeline customers.
At the same time, our products and services appeal to a very broad range of customers,
all of whom are seeking value. Already, approximately two-thirds of our gross additions
come to Cricket from a post-paid carrier. To increase our appeal among post-paid
customers, we offer a compelling value, great devices and national coverage, along with
key differentiators like Muve Music®, the first unlimited music service designed for the
mobile phone that does not require a computer.
Our Muve Music service was available to more than 1.1 million customers at year
end, making it one of the largest on-demand music subscription services in the United
States. More than 22 percent of our customers were on a Muve Music service plan at the
end of 2012, up from 9 percent at the end of 2011. Most importantly, users of Muve Music
have shown higher customer satisfaction and lower deactivation rates.
In order to compete successfully, we have to solve the high out-the-door device price
hurdle for our customers. Consumer desire for iconic, high-end devices has allowed post-
paid carriers to turn device sales from being a subsidy tool into a very lucrative profit
center. We expect to evolve and enhance our device financing programs later this year. We
will also continue to innovate and offer new products to target and attract more post-paid
customers in the year ahead.