Report: Sprint set to join rivals with 'One Up' handset upgrade program

Sprint (NYSE:S) appears set to join its competitors T-Mobile US (NYSE:TMUS), AT&T Mobility (NYSE:T) and Verizon Wireless (NYSE:VZ) in offering its own early handset upgrade program, according to a CNET report. The report, citing internal Sprint screenshots, said the plan is called "One Up" and will let subscribers pay for their smartphones or tablets in monthly installments and upgrade their device after every year by trading them in.

According to the report, Sprint's program allows customers to purchase a phone with no money down and pay for the device in 24 monthly installments. If a customer leaves Sprint early, they must pay the balance of the device's cost, due the following month. After a year,  customers can upgrade to a new phone by trading in their device if it is in good working order. The report said customers will sign up for One Up with Sprint's new Unlimited, My Way or All-In plans and One Up gives users a $15 discount, which allows for an unlimited voice, texting and data plan for as low as $65 a month.

A Sprint spokeswoman declined to comment on the report.

Additionally, the report said subscribers who have been on contract for at least a year are also eligible for the upgrade program, although restrictions may apply. The report added that existing customers still on contract must trade in their existing phones, unless they are already eligible for a discounted upgrade. Sprint prepaid customers aren't eligible for the One Up program, the report said.

The report said Sprint will launch the One Up program Sept. 20. If Sprint does launch such a program it would follow a flurry of announcement by its rivals over the last several months for similar offerings. Analysts generally agree that such plans are not necessarily the best deals for consumers but could boost carriers' margins, at least in the short term.

"I think these plans are here to stay," Wells Fargo analyst Jennifer Fritzsche told Bloomberg. "It's very good for the carriers since it decreases their subsidy costs and takes some pressure off their hardware expenses."

T-Mobile's handset upgrade program, called Jump, also lets customers upgrade to a new phone every six months if customers finance the device through the T-Mobile EIP (equipment installment plan) and pay $10 per month per phone. The $10 fee lets customers upgrade their phone twice every year after the initial six month enrollment period has expired. T-Mobile says the $10 fee not only pays for enrollment in the Jump program but also is an insurance plan that will protect the customer if their device malfunctions, is damaged or is lost.

"This represents a significant moment for people to rethink who their carrier is and switch to T-Mobile," T-Mobile CMO Mike Sievert told Bloomberg. "People have been waiting, either because they are stuck in contracts, or waiting for the new iPhone."

Meanwhile, AT&T's Next handset upgrade program lets customers upgrade their smartphones and tablets every 12 months if they agree to add a monthly installment payment to their bill. Customers buy a smartphone or tablet with no down payment and agree to pay monthly installments for the device over the course of 20 months. However, after 12 payments, if the device is in good working order, customers can trade it in and upgrade to a brand new device with no down payment, or can keep using their device and have no more payments after 20 months. If AT&T customers cancel wireless service, the remaining balance on the device becomes due.

Verizon's Edge program divides the cost of a phone over 24 months, and if after six months 50 percent of the retail price of the phone is paid, the customer can upgrade to a new device. The only caveat is that customers must be on a Share Everything data plan.

For more:
- see this CNET article
- see this The Verge article
- see this Bloomberg article

Related Articles:
Analyst: Handset upgrade programs could juice carriers' margins, for a short time
18% of Americans would sign on to a handset upgrade plan, according to survey
Verizon's Shammo doesn't expect many to sign up for Edge upgrade program
Verizon gives handset upgrades every 6 months with new Edge program
T-Mobile slams AT&T's 'Next' handset upgrade program
AT&T's 'Next' program allows smartphone, tablet upgrades every 12 months
T-Mobile gets 'jump' on the competition with new handset upgrade program

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