Sprint Corporation S, the third largest wireless communication company in the U.S., is leaving no stone unturned to intensify the wireless pricing war in the country. With a view to entice customers, the company has extended its existing Slash Your Payment in Half promotional policy to its prepaid wireless subsidiary – Boost Mobile.
Boost Mobile has stated that it will substantially reduce the phone bills of T-Mobile US, Inc.’s TMUS MetroPCS and AT&T, Inc.’s T Cricket customers by 50% if they switch to its service. Further, the company has claimed that the new promotional plan, which runs through Jul 20, 2015, can deliver $20–$30 in savings per month for a year for customers who wish to opt for it.
As per the new plan, Boost Mobile will offer 2.5GB of high-speed data for merely $20 to MetroPCS’ customers who are presently shelling out $40 per month for 2GB. In the same vein, it will provide 10GB of data for just $30 per month to Cricket’s customers who currently pay $60 for the same.
Naturally, Boost Mobile claims considerable savings for customers vis-à-vis MetroPCS and Cricket’s comparable offerings. However, a compatible Boost device is a requisite for customers who wish to receive the benefits of the deal.
Moreover, once the year-long promotion ends, a customer who had shifted to Boost Mobile will be automatically migrated to a befitting regular plan that will provide comparable features and data services. Current plans under Boost Mobile offer the best value in the industry with prices ranging from $30–$55 per month.
Interestingly, Sprint had first rolled out its Slash Your Payment in Half plan in Dec 2014, reducing the phone bills of AT&T and Verizon Communications’ VZ customers by 50% for those willing to switch over to its service.
Notably, Sprint’s continual efforts to lure rival carriers' customers reflect the cutthroat competition that is typical of the U.S. cellular market, leaving little scope for new subscriber growth. Naturally, dominant players in the space are forced to look for growth by poaching each other's existing subscribers.
We believe the new plan should prove beneficial to Sprint’s top line, ARPU and simultaneously, help check customer churn in the long run. This should help the company retain its competitive position among the major wireless carriers in the U.S., going ahead.
Sprint currently has a Zacks Rank #3 (Hold).
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