Sprint has announced that it will be adding a new $10 monthly Premium Data surcharge for users of smartphones from the end of January 2011, affecting all new subscribers. According to the carrier, it is "committed to providing its customers a great wireless experience now and in the future" and so has decided that the best way to do that is charge people more for it.
Featurephones, meanwhile, will escape the surcharge. There's no definitive list of which handsets Sprint considers to be smartphones and which are featurephones, though we're guessing Sprint will reveal that before implementing the price change on January 30.
Existing subscribers with smartphones won't see their price plans affected - until they upgrade, of course - but for all Sprint's talk of doubling smartphone penetration over the next four years, we can't see this going down well. The carrier claims smartphone users are responsible for 10x more data traffic than those users of traditional phones.
Smartphones Drive Wireless Data Explosion
Sprint takes step to ensure customers continue to enjoy unlimited data while on the Sprint Network, without overages
Smartphone penetration is expected to double during the next four years.1
Market share for Google’s Android operating system grew by 23 percent last year alone.2
Mobile data traffic is forecast to double worldwide each year through 2014.3
OVERLAND PARK, Kan. (BUSINESS WIRE), January 18, 2011 - Today’s ability to do more things on the go – such as watching videos, sharing pictures or checking directions – is not only changing the way we live; it is driving exponential growth of mobile data traffic.
Sprint (NYSE: S) is committed to providing its customers a great wireless experience now and in the future. From its packed portfolio of innovative phones and devices to its leadership in introducing 4G services, to its consumer-friendly Everything Data plans, featuring unlimited text, Web and calling to any mobile phone, Sprint offers the best value in wireless.
Sprint will increase its postpaid rates by applying a $10 per month Premium Data add-on charge to activations of smartphones beginning Jan. 30. The charge will assist Sprint in offering simple and affordable unlimited plans for its customers while maintaining a wireless network able to meet the growing appetite for a richer mobile experience. Subscribers with smartphones will still receive the best value in wireless, including the Any Mobile, Anytime feature offered nationwide only by Sprint.
Sprint also offers a full range of traditional feature phones, including popular eco-friendly or touch-screen handsets that do not require the Premium Data add-on charge but still have a great range of capabilities with voice, text and data access. Existing Sprint smartphone customers are not affected unless they upgrade to or activate another smartphone.
“Sprint wants its customers to experience the range of entertainment and productivity possibilities available with today’s wireless technology,” said Bob H. Johnson, president of Sprint’s consumer business. “While some of our competitors impose overage charges and complex plans, Sprint continues to provide a worry-free, unlimited data experience while on the Sprint network. This is responsible, sustainable and reflects our commitment to simplicity and value.”
“Sprint’s decision to apply the Premium Data add-on charge to activations of smartphones going forward recognizes the enhanced user experience that today’s smartphones deliver, which, in turn, drives substantially higher data usage and cost,” said Roger Entner, analyst and founder of Recon Analytics.
“Building, maintaining and expanding wireless data networks isn’t free – there are real costs involved. In effect, Sprint has chosen to increase the price of its unlimited Everything Data plans, which is still below that of its major competitors, for the segment of customers – smartphone users – who are using wireless data the most and are driving up costs. Consumers have many choices. They can choose unlimited, worry-free data plans on the Sprint network or they can have tiered, metered plans and overage charges with other wireless carriers.”
Smartphone customers use, on average, 10 times more data than users of traditional feature phones. Smartphone users have access to more data capabilities, applications and other functionality than traditional feature phones. Examples include access to thousands of applications and games through online marketplaces and full HTML Web browsing with Adobe Flash technology that allows users to browse the Internet on their devices just like they can at home or in the office.
Sprint defines smartphones as devices with robust operating systems that deliver a rich wireless experience by bringing the full function of mobile applications and programs to life, including Blackberry, Android, Windows Mobile, Palm, and the Instinct family of devices. The Premium Data add-on charge previously applied to HTC EVO 4G, HTC EVO Shift 4G and Samsung Epic 4G devices.
“Sprint continues to be the carrier for people who want to do more than just talk with their wireless devices,” said Johnson. “Customer growth on our 3G and 4G networks, exponential increases in the use of mobile data applications, and the growing use of smartphones is proof that consumers are getting the message.
“Sprint’s unlimited data plans, with or without the $10 charge, continue to beat the offerings of our top national competitors, who cap users’ data, charge data overages, and do not offer the unique functionality of Any Mobile, Anytime, which gives subscribers on the Sprint network unlimited calling to any other wireless user in America regardless of carrier.”
About Sprint Nextel
Sprint Nextel offers a comprehensive range of wireless and wireline communications services bringing the freedom of mobility to consumers, businesses and government users. Sprint Nextel served more than 48.8 million customers at the end of the third quarter of 2010 and is widely recognized for developing, engineering and deploying innovative technologies, including the first wireless 4G service from a national carrier in the United States; offering industry-leading mobile data services, leading prepaid brands including Virgin Mobile USA, Boost Mobile, Common Cents Mobile and Assurance Wireless; instant national and international push-to-talk capabilities; and a global Tier 1 Internet backbone. Newsweek ranked Sprint No. 6 in its 2010 Green Rankings, listing it as one of the nation’s greenest companies, the highest of any telecommunications company. You can learn more and visit Sprint at www.sprint.com or www.facebook.com/sprint and www.twitter.com/sprint.
1 Heavy Reading, Assessment of Sprint’s Network Vision Initiative, by Berge Ayvazian, Dec. 10, 2010.
3 Cisco Visual Networking Index: Global Mobile Data Traffic Forecast Update, 2009-2014.