Sprint CEO Dan Hesse says that Sprint may raise prices when LTE footprint gets competitive

[Fifth313ment]

http://news.cnet.com/8301-1035_3-57516148-94/sprint-may-boost-plan-prices-when-lte-network-gets-stronger/

 

What scares me is today, layman's terms, Sprint's Dan Hesse said that once the 4G LTE roll-out has a higher completion rate (more cities & areas covered) they will raise prices! Now I would take this as a huge slap in the face as I have had a 4G capable phone for over three years but I have never used it more than a couple times due to a just about non-existent coverage. Just about all my friends have Sprint also and we have all said that if they raise their prices we will all be outtie. Hell, many of us have thought about switching to MetroPCS just to get better LTE speeds now! I'm going to make a prediction that if they raise their rates anytime within the next three years they will stay in third place for the foreseeable future. In South Florida MetroPCS will be launching the Samsung Galaxy S3 soon and if they keep up with the higher profile phone launches then they might be a viable alternative who is not only cheaper and faster but who also has decent phones, which is my main reason for staying with Sprint (and many others). This reminds me of a med student who has a girlfriend all throughout his college years and then once he becomes a doctor he leaves her for a model, lol.

[S4GRU]

I moved this post out of another thread. I figured it deserved its own thread.

 

Robert

[pyroscott]

I highly doubt that they will raise the prices of existing contracts. They will probably raise the base rates for new customers. They won't do anything unless they feel they can sustain/grow their customer base. They will undoubtedly start disallowing SERO plans to be renewed at some point as they don't make jack from those contracts, so as long as they still have a decent customer base, they won't be hurt by losing those customers. Their customer satisfaction numbers will probably go up as well once they dump all those contracts.

[dedub]

I always figured that they will eventually start with rolling the 'premium data' charge into the base price, then redistribute the pricing structure from there.

[djmiro83]

I highly doubt that they will raise the prices of existing contracts. They will probably raise the base rates for new customers. They won't do anything unless they feel they can sustain/grow their customer base. They will undoubtedly start disallowing SERO plans to be renewed at some point as they don't make jack from those contracts, so as long as they still have a decent customer base, they won't be hurt by losing those customers. Their customer satisfaction numbers will probably go up as well once they dump all those contracts.

 

What they'll probably do is "force" you to change your plan when you get a new phone because the "old plan" isn't compatible with your device. (aside from SERO... those are bound to become extinct)

[ryry4ya]

expecially when people talk about wanting to tether there L T E connection. if Sprint instituted a cap , it should be in the 10 gigabyte range . anyone I know expecially so many heavy users , don't even come close .

 

Waterproof Evo

[jroepcke51]

I know this might be frustrating, but I look at it on the bright side. Hesse is looking at the progress and the potential of what the three different platforms of LTE (800, 1900 and 2600) and what Sprint will be when the convergence of all three is complete. Finally, it will be a network a customer will want to be on. Lets be honest, we all like it when an underdog takes over the Goliants.

[Thomas L.]

Sprint should be careful if they don't want to end up with mad customers that feel betrayed and end up leaving. With T-Mobile's network modernization plan they might end up becoming the new Sprint with Sprint moving into more of an AT&T level position.

 

Sent from my SPH-L710 using Xparent ICS Blue Tapatalk 2

[iansltx]

The catch is that, if Sprint decides to implement higher pricing (on a lower cost basis, I might add), then the competition had better follow suit. T-Mobile is already less expensive than Sprint ($70 + phone subsidy for unlimited everything, with phone subsidies topping out at $20 per month), and T-Mobile will in all likelihood deploy LTE very quickly next year, since they already have the requisite backhaul to the vast majority of their cell sites. When that happens, I wouldn't expect Verizon or AT&T to take notice, but Sprint (and everyone smaller than them) will be forced to do so.

 

Also, now that Verizon and AT&T have set up Share Everything/Mobile Share, they can't raise prices on anything without getting a ton of public flak. They can grow revenue as people use more data, but if Sprint is going to stay cost-competitive they have to prove that, for the average Joe, they still offer a less expensive product. Because, like it or not, Verizon will continue to have more LTE coverage than Sprint for awhile yet, so they're the ones with pricing power, not Sprint.

[Boosted20V]

The catch is that, if Sprint decides to implement higher pricing (on a lower cost basis, I might add), then the competition had better follow suit. T-Mobile is already less expensive than Sprint ($70 + phone subsidy for unlimited everything, with phone subsidies topping out at $20 per month), and T-Mobile will in all likelihood deploy LTE very quickly next year, since they already have the requisite backhaul to the vast majority of their cell sites. When that happens, I wouldn't expect Verizon or AT&T to take notice, but Sprint (and everyone smaller than them) will be forced to do so.

 

Also, now that Verizon and AT&T have set up Share Everything/Mobile Share, they can't raise prices on anything without getting a ton of public flak. They can grow revenue as people use more data, but if Sprint is going to stay cost-competitive they have to prove that, for the average Joe, they still offer a less expensive product. Because, like it or not, Verizon will continue to have more LTE coverage than Sprint for awhile yet, so they're the ones with pricing power, not Sprint.

 

Regarding your last point, I doubt Sprint will ever compete with VZ based on LTE footprint. VZ's footprint is ridiculous compared to Sprint(Overall, 3G at this point) and even with the low frequency spectrum Sprint is freeing up, theres many areas I doubt Sprint would venture into with expansion.

[iansltx]

Regarding your last point, I doubt Sprint will ever compete with VZ based on LTE footprint. VZ's footprint is ridiculous compared to Sprint(Overall, 3G at this point) and even with the low frequency spectrum Sprint is freeing up, theres many areas I doubt Sprint would venture into with expansion.

 

Which is why Sprint has, as its price ceiling, whatever VZW charges. Which, mark my words, will decrease as time goes on.

 

As for overall coverage, Verizon does indeed have the largest 3G footprint of anyone. However Sprint has enough 3G that it isn't relegated to the bargain basement of providers like CricKet and MetroPCS. And Sprint will have LTE on nearly every /tower/ in its network when it is done, versus Verizon who merely promises to cover every /area/ with LTE that has 3G now. The difference being that VZW will have a lot fewer towers...and thus, lower capacity, versus Sprint, all else equal.

[jroepcke51]

"Sprint should be careful if they don't want to end up with mad customers that feel betrayed and end up leaving. With T-Mobile's network modernization plan they might end up becoming the new Sprint with Sprint moving into more of an AT&T level position."

 

 

It seems to me that you are focused on the short term. Hesse is looking at what Sprint will be in 2014/2015 with a fully functioning network and potentially the first nationwide network of LTE-Advanced. Sprint, once the dust settles, will be the LTE leader by far.

[themuffinman]

http://news.cnet.com...-gets-stronger/

 

What scares me is today, layman's terms, Sprint's Dan Hesse said that once the 4G LTE roll-out has a higher completion rate (more cities & areas covered) they will raise prices! Now I would take this as a huge slap in the face as I have had a 4G capable phone for over three years but I have never used it more than a couple times due to a just about non-existent coverage. Just about all my friends have Sprint also and we have all said that if they raise their prices we will all be outtie. Hell, many of us have thought about switching to MetroPCS just to get better LTE speeds now! I'm going to make a prediction that if they raise their rates anytime within the next three years they will stay in third place for the foreseeable future. In South Florida MetroPCS will be launching the Samsung Galaxy S3 soon and if they keep up with the higher profile phone launches then they might be a viable alternative who is not only cheaper and faster but who also has decent phones, which is my main reason for staying with Sprint (and many others). This reminds me of a med student who has a girlfriend all throughout his college years and then once he becomes a doctor he leaves her for a model, lol.

 

The first 4g phone came out 2 years 3 months ago, what 4g phone have you owned for over 3 years?. Anyway, if sprints network is as beastly as they hope for it to be then they have every right to be as profitable as possible while staying competitive. Look at verizon, they basically cost more than everyone else yet they have the most customers, why is that? Because they have the network to back up what they want to charge, no one is gonna pay a premium to be on sprints network right now but if in a few years the now network is solid and fast then they can get away with raising prices.

[themuffinman]

Sprint should be careful if they don't want to end up with mad customers that feel betrayed and end up leaving. With T-Mobile's network modernization plan they might end up becoming the new Sprint with Sprint moving into more of an AT&T level position.

 

Sent from my SPH-L710 using Xparent ICS Blue Tapatalk 2

 

At any given moment in time, regardless of whatever the situation may be there will always be mad customers that will feel betrayed and leave whatever carrier they are on.

[Fifth313ment]

I moved this post out of another thread. I figured it deserved its own thread.

 

Robert

 

Thanks Robert.

The first 4g phone came out 2 years 3 months ago, what 4g phone have you owned for over 3 years?. Anyway, if sprints network is as beastly as they hope for it to be then they have every right to be as profitable as possible while staying competitive. Look at verizon, they basically cost more than everyone else yet they have the most customers, why is that? Because they have the network to back up what they want to charge, no one is gonna pay a premium to be on sprints network right now but if in a few years the now network is solid and fast then they can get away with raising prices.

Sorry I meant 2 years 6 months, lol. OG EVO and EVO LTE. WiMax and LTE both don't work in my area, well the former works sporadically throughout but not at my house or anywhere I mostly go. And Verizon was the most expensive back when they had crappy 3G so that point is unusable.

[cdiao]

At any given moment in time, regardless of whatever the situation may be there will always be mad customers that will feel betrayed and leave whatever carrier they are on.

 

I alternate between getting mad at Time-Warner Cable and Verizon FiOS and threatening to leave one for the other, depending who was the last customer service I had to deal with, but I still need cable TV/broadband so I have to deal with some carrier (can't get away from them). Except during football season when I have to stay on Verizon in order to stream NFL Redzone games to my Sprint smart phone (so I make it a point not to call Verizon Cust Svc lest they piss me off). The things that we do to accomodate our lives to the carriers that we are beholden to.

 

I would be perfectly happy to pay more if I got 800mhz coverage and in-building penetration and 20mhz-40mhz "fat pipes" (i.e. overlayed broadly with CLWR's TDD-LTE),... well maybe just a bit more. In reality, I know that I really can't move to AT&T or Verizon so am only left with T-Mobile to play nice with.

[surma884]

I highly doubt that they will raise the prices of existing contracts. They will probably raise the base rates for new customers. They won't do anything unless they feel they can sustain/grow their customer base. They will undoubtedly start disallowing SERO plans to be renewed at some point as they don't make jack from those contracts, so as long as they still have a decent customer base, they won't be hurt by losing those customers. Their customer satisfaction numbers will probably go up as well once they dump all those contracts.

 

SERO plans get 15% off, while SOME corporate plans get 25%. So I don't think SERO is killing them.

[pyroscott]

 

SERO plans get 15% off' date=' while SOME corporate plans get 25%. So I don't think SERO is killing them.[/quote']

 

Sero gets a lot more than 15% off.

 

I think you are thinking about the new SERP plans. I am referring to the grandfathered sero plans. Those are not killing sprint, but they are not generating any profit for reinvestment in the network.

[MaxPower]

When I signed up with Sprint 2 years ago my plan cost $190 for 5 smartphones, right now it's up to $240. I thought the $50 price hike was for the network improvement. I don't mind getting another price hike when their network improves but it would have to be a minor one.

[keelerman8042]

If they do raise it I wouldn't mind paying a little more for it maybe like 10 bucks... I could deal with 89.99 a month if they keep unlimted which we all hope

To add to this as well if sprint were to add like 20-40 bucks let's say its still cheaper then Verizon with a data plan that is not unlimted and if sprint stays unlimited that's still a good deal in my opion but Idk what sprints plans are but if they were not then that would kinda stink but I rather pay that for unlimited then be caped off or anything else

[tybo31316]

I thought the whole point of network vision was to consolidate the networks down to 1 to save on operation cost so that they wouldn't have to raise prices.

[dedub]

the whole point is to make money, so if it comes ot the point they need to raise prices, they will.

 

Until or if the do, its all a bunch of un-needed angst worrying about it.

 

They have a long way to go with the network before they can even consider it. The cellular landscape may be completely by then.

 

Besides all that, prices can rise at any time for any reason (albeit they would have to deal with unhappier customers).

 

If you really want to be mad at rising prices, look at gas prices for the last few years.

Edited September 19, 2012 by dedub

[S4GRU]

Where was he speaking? Goldman Sachs Conference. To whom? Investors. What do investors want? Sprint to increase revenues. Is this surprising to me? Not in the least.

 

Sprint is always under pressure from investors to do anything to maximize revenues...and to make a profit. Sprint is always hearing from Wall Street about raising rates when the network recovers. Dan is just playing the crowd.

 

However, always expect Sprint to charge the most they think their customer base will pay. Right now, with the network in the condition the way it is, we are paying the maximum that we will bear. I have a feeling that 12 months after Network Vision, we will have a different opinion. And if the big two raise their rates, Sprint will have some breathing room to raise rates.

 

Robert

[lordsutch]

Which is why Sprint has, as its price ceiling, whatever VZW charges. Which, mark my words, will decrease as time goes on.

 

That seems exceedingly unlikely. VZW is the premium brand in the wireless space. I have no doubt their caps will eventually go up, due to competitive pressure (and marginal bandwidth is cheap), but I doubt base pricing is likely to go down unless customers start defecting en masse, or finally figure out they're (in most cases) better off on prepaid, which there's no sign of happening. Everyone in the industry is about increasing ARPU; you don't gain ARPU by lowering prices.

 

Now, circa 2020 when we have a European-style wireless market with 3-4 national carriers (VZW, ATT, and whatever shakes out of Sprint, T-Mobile, and regional carrier consolidation) where everyone is on LTE Advanced & VoLTE, every phone can talk on 700, 850, SMR, 900, 1800, 1900, AWS, and 2500, changing carriers is as simple as popping in a new nanoSIM or doing an NFC scan of an activation card, and carrier subsidies for new phones get much smaller, maybe prices will go down due to competition.

[ryry4ya]

can someone tell me what the profit margin was for the quarter ?..we should not have to pay so much for investment into something we shoulda had

 

Waterproof Evo