BELLEVUE, Wash., and SARASOTA, Fla. -- Coinstar Inc. (Nasdaq: CSTR) and Prizm Technology, Inc. have partnered on a pilot that will allow prepaid wireless phone users to recharge their account balances at Coinstar's coin-counting machines in supermarkets.
According to a news release, the pilot will begin during the fourth quarter of 2002 and will involve up to 75 locations in the Sacramento, Calif., Tampa, Fla., and Providence, R.I., areas.
Branded by Prizm as Top-Up™, the service links to wireless carriers who offer prepaid plans, representing approximately 80 percent of the market. A prepaid customer will be able to go to the Coinstar Center and, by entering a phone number and inserting cash, add minutes to their account.
Coinstar is using Prizm Technology's ePrizm Back Office System, which includes transaction processing software and back-office support services.
"The prepaid wireless market presents a natural opportunity for Coinstar," said Rich Stillman, Coinstar's chief operating officer, in the release. "Prizm's existing technology will give us a quick start in launching a pilot that will enable us to measure consumer acceptance of this service."
According to the Yankee Group, there were approximately 16 million prepaid wireless subscribers in the United States, or 12 percent of all wireless accounts, at the end of 2001. The Yankee Group projects that by 2006, nearly one-fourth of the wireless market, or 50 million subscribers, will be prepaid, representing aggregate wireless services revenues of more than $20 billion.
Dave Cole, Coinstar's chief executive officer, said in the release, "This pilot fits into our overall growth strategy, which includes the development of new products and services that leverage our existing infrastructure. We intend to continue to pursue limited-risk pilots that enable us to assess a business's viability before rollout and the commitment of significant capital resources."
Coinstar Inc. has more than 10,000 machines linked by an interactive network throughout the U.S., as well as in Canada and the UK.
