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Rumor Mill: Sprint to launch Sprint-branded prepaid service

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Sprint Nextel (NYSE:S) will launch its own branded prepaid service later this month, according to the blog Android Police. The move would add another layer to Sprint's multi-pronged prepaid strategy.

According to the blog, which cited promotional material it received, Sprint will introduce the Sprint As You Go prepaid brand Jan. 25. The brand will compete with Sprint's Boost Mobile and Virgin Mobile brands and will offer two plans: a $70 per month plan for smartphones offering unlimited voice, texting and Web access, and a $50 per month plan for feature phones. However, the plans do not include EV-DO data roaming, according to the promotional materials. 

A Sprint spokeswoman declined to comment.

There are only two smartphones that will work with the plans, the blog said: the LG Optimus Elite for $150 and the Samsung Victory for $250. Neither of those devices appears to have support for Sprint's burgeoning LTE network. On the postpaid side, Sprint currently sells high-end, LTE-capable devices like the Samsung Galaxy S III and HTC Evo 4G LTE.

The plan could be a way for Sprint to get out in front of the combined prepaid offerings T-Mobile USA and MetroPCS (NYSE:PCS) will bring to the market if their merger is approved later this year. Flat-rate player MetroPCS has indicated it plans to use T-Mobile's network to expand its brand nationwide after the merger closes.

The Sprint As You Go plan will also compete with Sprint's existing prepaid plans. Sprint's prepaid offerings stretch across the Boost Mobile, Virgin Mobile and Assurance Wireless brands. Sprint also offers prepaid services through a number of MVNOs including Ting, republic wireless and others. 

It's unclear whether the Sprint As You Go prepaid service will throttle users' data speeds. Starting this year both Boost and Virgin will throttle the data speeds of customers who exceed 2.5 GB of data usage per month. Further, Boost and Virgin support smartphones that run on Clearwire's (NASDAQ:CLWR) mobile WiMAX network, and are rumored to be ready to support devices that run on Sprint's LTE network.

In the third quarter Sprint added a net total of 19,000 prepaid customers. However, that included net additions of 459,000 prepaid Sprint platform customers, and was offset by net losses of 440,000 prepaid Nextel platform customers. Sprint is shutting down the Nextel iDEN network this year and expects to continue to lose Nextel customers as it does so, though the company is working to migrate those subscribers to its CDMA network.   

For more:
- see this Android Police post
- see this CNET article

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