Sprint (NYSE: S) said it plans to increase the cost of its unlimited plan -- which offers unlimited calling, texting and data -- by $10 per month starting Oct. 16. The carrier currently charges $60 per month for unlimited service, and that price will increase to $70 per month in roughly two weeks. Importantly, the carrier pointed out that price is still cheaper than what T-Mobile US (NYSE:TMUS) charges for unlimited service ($80 per month). AT&T (NYSE: T) and Verizon Wireless (NYSE: VZ) don't offer unlimited data options.
"At Sprint, we give customers what they want -- and they want the option of unlimited data," Sprint CEO Marcelo Claure said. "At $70 a month, Sprint still beats the competition. Rather than increase the price without warning, we want to give customers one last chance to take advantage of the $60 rate."
Sprint said its existing $60 unlimited customers will not be subject to the increase.
Sprint also used the announcement to refocus on its continuing iPhone Forever promotion. The carrier said customers can purchase the iPhone 6s 16GB for $1/month and the iPhone 6s Plus for $5/month with the trade-in of an iPhone 6 or iPhone 6 Plus that the customer owns in full. Meaning, for the next two weeks a new Sprint customer could purchase the 16 GB iPhone 6s and unlimited service for $61 per month.
Sprint's move to increase the price of its unlimited service is noteworthy considering it has worked feverishly to position itself under its new CEO as the "value" provider in the wireless industry. Sprint has consistently worked to lower its prices below those of the competition: Last year the carrier said it would offer services at half the price charged by market leaders AT&T and Verizon. Thus, the carrier's new price increase stands as a notable move -- though not much of a surprise considering Sprint's ongoing financial struggles and its need to generate more revenues.
Indeed, in the second quarter Sprint reported net operating revenues of $8 billion for the quarter, down 9 percent from a year ago, driven by lower wireless and wireline service revenues and also lower equipment revenues. The carrier's wireless service revenues clocked in at $6.6 billion for the quarter and were down 8 percent year-over-year due to a lower postpaid phone customer base and cheaper rate plans offered in conjunction with device financing options.
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