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Wal-Mart expands prepaid phone service to AT&T

Customers looking for lower monthly rates from a prepaid cell phone will soon be able to find some on the AT&T network in Wal-Mart stores.

Shoppers perusing Wal-Mart for a cell phone will soon have double the options--that is, a choice of purchasing a prepaid phone on two carriers instead of just one.

Wal-Mart's Straight Talk wireless service, which has previously run only on Verizon's networks, is expanding to AT&T. StraightTalk is a brand made by TracFone, and is sold exclusively in Wal-Mart stores.

AT&T confirmed to The Wall Street Journal on Monday that StraightTalk phones will work on the network. Wal-Mart would not comment on the impetus behind building out the service to include AT&T.

The expansion to AT&T is interesting for two reasons. First, it gives Wal-Mart a foothold in the GSM prepaid market, in addition to its presence on CDMA channels through Verizon's network. This will allow Wal-Mart to sell its prepaid phones to customers who may live in a coverage area better served by AT&T than by Verizon.

Second, the agreement lets AT&T gain new customers through Wal-Mart's prepaid channels. The Journal notes that "Verizon Wireless added 896,000 customers through its wholesale partners--with Straight Talk believed to be the largest contributor." That's nothing to sneeze at were AT&T able to similarly acquire new customers.

Article updated at 1:18PM PT with Wal-Mart's response.