Sprint lowers unlimited to $50, kills tiered pricing options

Sprint said its new unlimited pricing options are well below the prices charged by its competitors. Image: Sprint

Sprint today lowered the cost of its unlimited data plan to $50 per month for a single line of service. “This new plan continues to offer the best price for unlimited among all national carriers. Verizon and AT&T unlimited plans are 50% more!” the company said in a release—noteworthy phrasing considering the carrier also ended its longtime 50%-off promotion that sought to cut in half the bills of customers who switched to Sprint.

“More than 90% of our customers are already choosing Unlimited,” said Roger Solé, Sprint’s chief marketing officer, in a release from the company. “During the past few months, we’ve seen other national wireless carriers offer unlimited plans, but their offers don’t match the value we provide. Within the first year, Verizon’s and AT&T’s unlimited plans will cost consumers at least 50% more!”

Sprint said its new unlimited data plans would cost $50 per month for the first line, $40 per month for two lines, and $30 per month for four lines. The carrier added that its unlimited data service offers HD streaming for video, music and gaming, and 10GB/month per line of mobile hotspot data.

In other caveats for the offering, the prices will remain in place until the end of May 2018, when they will rise to $60 per month for one line of service, $40 per month for two lines of service and $30 per month for three or four lines of service. The carrier said its video streams are capped at 1080p, music streams are capped at 1.5 Mbps, and gaming streams are capped at 8 Mbps. “Data deprioritization during congestion. Pricing shown with $5/month AutoPay discount applied within two invoices,” the carrier added.

Sprint’s move to end its 50%-off promotion and to eliminate its tiered pricing options, was reported yesterday by The Wall Street Journal citing Wave7 Research.

Despite Sprint’s new offer, analysts generally expect Sprint and the rest of the nation’s wireless carriers to report relatively sluggish first quarter results. “As has been the case with peers, we believe Sprint experienced a rougher go this past quarter, battling elevated competition, tougher seasonality and a delayed tax rebate season,” wrote the analysts at Deutsche Bank in a report issued to investors this morning just prior to Sprint’s announcement. “Net net, we modestly reduce postpaid phone volumes for the quarter (DBe: +40k, from +55k prior), as we believe higher churn was offset by (more costly) gross add growth.”

The analysts also offered some thoughts on Sprint’s overall strategic position in the marketplace, noting that the carrier likely will benefit due to its trove of 2.5 GHz spectrum holdings, as well as its potential option to merge with the likes of T-Mobile or a cable operator. “With anti-collusion rules from the Broadcast spectrum auctions likely lifted around the end of April, Sprint’s strategic prospects may continue to overshadow weaker fundamentals. We see material upside in M&A scenarios, with valuations ranging from $11-$13/share (30-55% upside from current levels),” the analysts wrote.