Republic Wireless will spin out from its parent company and become an independent entity, a sign that cheaper, Wi-Fi-based cellphone services are able to stand on their own in a hotly competitive wireless market.
David Morken, chief executive of Republic parent Bandwidth.com, said in an interview that spinning off the Wi-Fi cell unit made sense, as more of Bandwidth.com’s customers have become direct competitors to Republic, and as Republic itself became more viable.
Bandwidth.com, which sells voice and data services to businesses, provides phone numbers and telecom services to rival Wi-Fi first cellular services like Alphabet’s Project Fi, as well as to Microsoft’s Skype and Google Voice.
Raleigh, N.C.-based Republic Wireless, which began selling service in 2011, has more than 300,000 subscribers and annual revenue of more than $100 million.
Republic offers monthly mobile phone subscriptions starting at $15 a month. Republic Wireless sends most of its voice, text and data traffic over Wi-Fi hot spots. When Wi-Fi isn’t available, Republic taps into the network of a national wireless carrier, such as Sprint or T-Mobile US.
After the spin-off, Mr. Morken will pass the role of Republic CEO to co-founder and operating chief Chris Chuang while keeping his role as chairman.