Back in September of 2012, we were enthralled by the young upstart MVNO out of the Seattle area called Solavei. Solavei was the first MVNO that leveraged the social media power of their members to spread the word about the mobile service. It seemed like a match made in heaven for the average consumer. $49 bought you an unlimited HSPA+ data plan on T-Mobile’s network and you could actually earn money on it by getting your friends on board as well. A number of early founders made a ton of money with the program, while most others floundered, but were still saving over the costs of their old plan.
Fast forward through a few payment system changes, a bankruptcy and some very questionable business practices, and we have the announcement the Solavei will be shuttering their operations on December 4th, 2015. To make the transition a bit easier, Solavei is offering their members a special switch over to T-Mobile’s prepaid network. Of course, if you are used to the Solavei coverage map, there are even better options through carriers like GIV Mobile and PTel Mobile that will save even more cash for users that need to find a new home.
With the specials that both GIV Mobile and PTel Mobile are running this week, users can get a free second month of service when they port their numbers or even get a free phone if needed. Keep in mind that both GIV Mobile and PTel Mobile run on the same T-Mobile network that Solavei did, so existing handsets will work just fine. In fact, many of the settings may be the same, so APN programming may not even be needed for some devices.
The downfall of Solavei was apparent to us back in 2013 when the first batch of price increases and payment changes hit users in their pocketbooks. Unfortunately, these users continued to fund world wide trips for the Solavei executives, as well as a nice new Mercedes for their Presidential Director, who just happens to be the sister of Solavei founder and CEO Ryan Wuerch. This isn’t the first time that Wuerch has had issues with a company that he headed. He was also s founder of Motricity, an mobile content provider that imploded in 2012 when AT&T pulled a major contract from them. Wuerch was later accused by investors of insider trading and fraud, though those claims were never proven to be true and Wuerch was never charged with any wrong doing. Wuerch walked away from Motricity after selling hundreds of thousands of shares of Motricity stock in the $20 per share range. The stock is currently trading at $1.92 per share, or about 10% of the value that it was when Wuerch luquidated his shares.
As for the discontinuation of service, Solavei cited that they were not able to work out an agreement with their network to continue to offer its members a viable option for providing their service and that they would have until December 4th to complete a port to another carrier. If members do not successfully port their numbers before this date, their accounts will be closed and their numbers will be placed in a dormant status where porting them will not be possible.
It’s always sad to see another MVNO fall to the wayside, but the Solavei business model was not something that was sustainable with the amount of cash and other compensation that was being doled out to the executives. If you were lucky enough to get in early and cash out, congratulations on a good run. If you were one of the users that just enjoyed a pretty good deal for a few years, it’s time to find a new carrier. Either way, it’s c’est la vie time for Solavei.