Hesse: Sprint could discontinue unlimited pricing

Sprint Nextel (NYSE:S) CEO Dan Hesse said the carrier doesn't have plans to implement tiered pricing for mobile data--but he didn't rule out such a move at some point in the future.

"We are watching very closely," Hesse said during the Goldman Sachs Communacopia XIX Conference. "Clearly, I'm not ruling out metered (pricing). But customers value simplicity."

Hesse acknowledged that Sprint does lose money on a small subset of customers who make heavy use of the company's networks. However, he said that, taking the company's total customer base into account, Sprint can make money despite those heavy users by attracting additional customers with a simple marketing message: unlimited service.

AT&T Mobility (NYSE:T) earlier this year introduced metered pricing for its mobile data service--$15 per month for 200 MB or $25 per month for 2 GB--and the carrier's CEO recently said the lower introductory pricing has served to encourage users to try out AT&T's data services. AT&T replaced its unlimited data pricing with a tiered approach in an effort to ease data traffic on its network, which the carrier has said increased 5,000 percent during the past three years.

Verizon Wireless (NYSE:VZ) too has hinted it will implement tiered pricing on its forthcoming LTE service, which is set to roll out later this year in 25-30 markets.

Sprint, for its part, has made its "Simply Everything" unlimited talking, texting and surfing offer a cornerstone of its marketing spin. Sprint's Hesse said consumers don't want to have to keep tabs on their wireless usage. Nonetheless, he said the carrier continues to evaluate whether to implement a metered model for data.

Interestingly, Sprint is the primary investor in Clearwire, which is working to build out a WiMAX network across the United States. Clearwire offers WiMAX service under an unlimited usage scenario, and has said users consume an average of 7 GB per month. Sprint resells Clearwire service under the Sprint 4G brand.

For more:
- see this Dow Jones Newswires article (sub. req.)

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