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Is Sprint's new half-off deal a desperation move?

Matt Hamblen | Dec. 3, 2014
The offer could be a boost for consumers but a big risk for Sprint, which had shaky revenues in the last quarter.

Sprint posted details online for how new customers can take advantage of the half-rate plan. The half-off discount applies only to the customer's base monthly service and does not include taxes and fees.

As an example, a Verizon customer paying $140 a month for four lines plus 10GB of data can get four lines (with the same phone numbers) plus 10 GB of data on Sprint for $70 a month.

For a limited time, Sprint will also waive the activation fee of $36 per line and will buy out a customer's contract for up to $350 per line.

Verizon and AT&T customers must provide a copy of their current bill, which can be uploaded online at the Sprint website starting Friday or provide a copy of that latest bill at a Sprint store.

Switching customers also must turn in all the phones they use on either Verizon or AT&T "in good working order." In exchange, they will receive new Sprint phones, although Sprint said it can't guarantee all features of the new replacement phones will be available. There's also no trade-in value for the old phones.

The new Sprint phones can be leased, paid for under installment or purchased at full retail price. Only one phone on a Verizon or AT&T account must be presented at set-up, but all other phones must be turned in by mail within 30 days or a $200 charge per line will be applied.

While halving the monthly service costs sounds attractive, some of the conditions may be troubling to consumers. "Whether the 'half off' plan translates into a lot of net additional customers is questionable once those customers get a load of all the terms and conditions -- gotta buy a phone from Sprint, no trade-in value for their old phone, gotta move all the lines from a family plan to qualify," said Bill Menezes, an analyst at Gartner.

Desperation or good business?
When asked whether Sprint intended the new half-off plan as a direct assault on T-Mobile, a Sprint spokesman chose not to even mention T-Mobile, although he discussed the concept of being dubbed a "value carrier."

"Most value offers drive [customer] interest; Sprint's value offers drive commitment," said the spokesman, Mark Elliott. "With a ramped-up rollout of value offers, Sprint is setting the bar for best value carrier in wireless. 'Cut Your Bill in Half' takes the bar up another notch."

This latest Sprint value plan came may be come because of a lack of interest in earlier value plans, such as the Family Share Pack promotion where families can share 20 GB of data across up to 10 lines for $100/month through Dec. 31, 2015. That offer was launched in mid-August shortly after Claure took over as CEO.

 

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