Carriers
Is Sprint’s Simply Unlimited plan working? Numbers say yes.
April 28, 2011 | by Andrew Kameka
Sprint
Sprint reported it’s Q1 2011 earnings today, and the Kansas City-based carrier revealed some respectable numbers, thanks in part to its Android phones. Sprint reported that it had a net gain of postpaid subscribers (contracts) of 310,000, and had a churn rate of 1.81 percent, which is the best quarterly performance the company has had in 5 years.
How the heck did they manage that?
One would assume that without a major phone release in the past three months to drum up excitement, Sprint would have lost thousands of customers as AT&T rolled-out the Atrix and Verizon introduced the iPhone. However, Sprint managed to survive a mass exodus, despite CEO Dan Hesse confirming that Verizon’s introduction of the iPhone definitely had an impact on the number of customers it was able to attract or retain.
It seems that Sprint’s performance was boosted by the success of its unlimited plans and customer satisfaction with their current devices. People often assume that an exciting new device can draw customers away from their existing carrier; however, in the absence of a new smartphone to grab headlines, Sprint still managed to have an 80 improvement in year-over-year performance. That success should probably be attributed to the more affordable unlimited plans that Sprint introduced last year.
Dan Hesse said that AT&T and T-Mobile became aggressive in pricing as a result of Sprint’s plans, and also suggested that the introduction of a 4G WiMax network pressured Verizon to accelerate its 4G LTE roll-out. He remained confident that Sprint managed to survive the competition thanks to its Simply Unlimited plans.
“Even after the $10 charge, our pricing is still very competitive,” Hesse said on an earnings call this morning. “We’re the only [network] that offers truly unlimited data.”
In the past, Sprint has largely credited the HTC EVO 4G with saving the company’s performance. Phones obviously played a critical role in the company’s rebound, but today’s results show Sprint is also managing to keep customers thanks to better options that come with those phones. In Q1 2010, Sprint lost 464,000 subscribers; in Q1 2011, the network lost only 114,000.
The power of Sprint’s offerings will be tested in Q2. Verizon has a slew of new phones on the horizon and has a growing 4G LTE network to put up against Sprint’s 4G WiMax. It may be best to deliver the EVO 3D sooner than later and not rely too much on affordability enticements.
Thanks to Russel Holly and DClaryJR for discussing today’s news with me and helping me form thoughts for this article.
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Take note Sprint… if it's the phones that are saving you, maybe think a little harder about keeping existing customers wanting the latest and greatest.
I purchased the EVO on a new line the minute it was available to order last June. Now I'm not eligideable for a upgrade until January 2012. Um, that sucks.
I'm more than happy to extend my contract forever, I'm not going anywhere anytime soon, but cut a guy a break that is willing to drop a couple hundred on a new phone every year. That may change though if I have to purchase them for $400+.
You have entirely too much disposable income.
Heads up , Sprint s honoring the one year upgrade, Costumers knowingly signed a contract where promise of a one year upgrade was made. .. visit your local sprint store and they will honor that…. if they don't… make them read the latest sprint flyer( Aprils and may) where they are told how's When's and who's for the upgrade for Current Costumers!!!
@jaymoon, it depends on how long you've been a Sprint customer. I bought the EVO last year in May and am eligible for an upgrade at a $150 discount in June of this year. Then again, I've been a Sprint customer since they were Nextel, business customers only and had two phones to choose from.
Right now, I have two phones, my EVO and the hubby's Blackberry Style on their gazillion minutes/texts a month plan and it costs me $129 a month. I looked at the iPhone at one point. I can't justify paying $129 a month for one phone that doesn't do everything my EVO does (though I understand the newest one is much more multitask friendly) so…how can I justify changing when I have a much cheaper plan and two awesome phones?
And as a side note, everyone, no matter the carrier, has horror stories to tell about their customer service experiences. Can't avoid them. If I'd based my decision solely on customer service, I guess I wouldn't even own a cell phone
JayMoon, once your contract has been around for a year, you've got a shot at an upgrade (at least that's the way it's been since I was a Sprint customer). They give preference to new contracts, but after the EVO 3D rush dies down, you should be able to upgrade by paying a little more like Tigrisan said. It shouldn't cost full retail to upgrade as long as it's been at least 12 months since your last extension.
Also, the point of signing a contract is to get the deal specified. If you sign an agreement for a discounted phone don't be surprised when they want you to wait until the end of that period before offering a full upgrade. To sign a deal for, say two years and then complain when they don't give you a screaming deal 10 months in is ridiculous.
I recently switched from AT&T to Sprint because of their unlimited plan. I LOVE it! I am paying a lot less than I used to with AT&T and am basically getting the same thing with my phone. It's perfect for me, because I only use a Blackberry. I don't have to worry about all of the new fancy phones coming out. Good job, Sprint!