Sprint is clinging to unlimited data plans as a key differentiator, and aims to use them to wrongfoot larger rivals when the LTE iPhone appears.
While the other national cellcos have abandoned all-you-can-eat data, because of the strain such tariffs put on their network capacity and profits, Sprint has retained them as a way to attract and retain customers even while it remains behind the big two in 4G. It was widely expected to use the shift to LTE, which starts this summer, to introduce tiered pricing ‘ as Verizon and AT&T did ‘ but it insists this is not the plan.
In particular, Steve Elfman, president of network operations, says the presumed ‘iPhone 5′ would carry unlimited data offers. He told Investor’s Business Daily: “When the iPhone 5 comes out, if we get it and when we get it, we’ll offer unlimited.’ That may be the only way for the third carrier to make its LTE iPhone more attractive to consumers than those of its rivals, whose 4G networks are far more advanced ‘ and will still be so when the new Apple device ships, even if that is late this year.
Craig Moffett of Bernstein Research said in the same article: “I don’t see a scenario where Sprint won’t get an LTE-capable iPhone at the same time as Verizon and AT&T. The problem is they will be so far behind in their LTE network when the iPhone 5 comes. AT&T and Verizon will be much further along, with much better spectrum, offering higher speeds.’
Sprint’s first LTE services will go live from July 15 in Atlanta, Dallas, Houston, Kansas City and San Antonio, but Verizon’s 4G network already covers more than 300 cities, while AT&T’s is available in 47 as of this week.
But the third cellco is under particularly intense pressure to sell large numbers of iPhones, as it made an ambitious commitment to the device when it gained the CDMA model last year. It reportedly agreed to pay Apple $15.5bn over four years, a deal which means its iPhone business will not be profitable until 2015 ‘ at a time when Sprint is also investing heavily in its Network Vision strategy. In its first two quarters as an iPhone carrier, Sprint sold 3.3m units, compared to 11.9m at AT&T (which has the largest upgrade base) and 7.5m at Verizon.