Sprint's Hesse hints unlimited data for smartphones might not last
Sprint Nextel (NYSE:S) CEO Dan Hesse said Sprint will not follow its prepaid brand Virgin Mobile in throttling the data speeds of smartphone customers. But he also indicated, as he has in the past, that Sprint's unlimited pricing might not last forever.
Speaking to reporters at the company's headquarters in Overland Park, Kan., Hesse said Sprint has no intention of following Virgin's move because prepaid and postpaid data are different animals. Virgin Mobile said earlier this month that starting in October it will begin throttling the connection speeds of customers with smartphones that use more than 2.5 GB of data per month. Virgin said less than 3 percent of its customers currently use that much data monthly.
Although some analysts have indicated that Sprint may be using Virgin's throttling to gauge customer reaction, Hesse said that it was not in the cards for Sprint. "Think of it as two different solar systems," Hesse said, according to CNET.
Sprint has been using its unlimited smartphone data offering, which does not levy overage fees or throttle speeds, as a key differentiator in the market. The carrier earlier this month highlighted Verizon Wireless' (NYSE:VZ) recent move to stop offering unlimited data service and reiterated Sprint's unlimited service.
However, Hesse said Sprint's ability to offer unlimited service depends on how much capacity the company has. "Every few months we take a look, we take a look at tonnage, and we take a look at all the things we're doing to offload tonnage ... We'll just continue to monitor it," he said, according to PC Magazine. "Nothing is forever ... [but] we think it's a terrific opportunity to differentiate ourselves in the market."
Sprint tacked on a $10 charge in January for its unlimited smartphone data customers, but said it did so to keep its unlimited pricing intact while recognizing that smartphone customers use more data.
- see this PC Magazine article
- see this CNET article
- see this Engadget post
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