Sprint raises smartphone termination fee to $350 weeks before iPhone 5 launch
Sprint has announced plans to follow AT&T and Verizon Wireless in charging a hefty $350 early termination fee for all "advanced" devices starting September 9, ensuring that customers won't be able to obtain new subsidized hardware and then ditch their service plan.
The policy change, noted by blog SprintFeed, goes into effect just weeks before Apple is expected to launch iPhone 5. Sprint is rumored to be among the US carriers that will carry the new phone.
Sprint previously charged its subscribers $200 to escape their subsidized service contract early, an amount prorated over the term of the contract. By boosting the fee to $350, Sprint will now be in the same ballpark as AT&T and Verizon, both of which hiked their fees to accommodate the shift from subsidizing cheap feature phones to subsidizing much more expensive smartphones.
AT&T's early termination fee was originally $175 for Apple's iPhone, the first widely popular phone costing around $650. The fee was intended to prevent customers from buying an iPhone as part of a contract and then abandoning the contract. Previously, expensive smartphones in the price range of iPhone were carried only by a minority of US customers.
At the end of 2009, Verizon raised its own smartphone early termination fee to $350 as it began to market Droid-branded phones running Android to replace flagging sales of Blackberry devices. The next spring, Google and T-Mobile launched the Nexus One with a $550 early termination fee, sparking scrutiny from the U.S. Federal Communications Commission.
Last summer, AT&T also raised its early termination fee on advanced devices like the iPhone to $325. AT&T's smartphone mix is now predominantly made up of iPhones, and Verizon's iPhone subscribers are growing fast enough to substantially knock down the carrier's share of Android phones within the US.
Sprint's own early termination fee hike suggests that it too will be focusing on moving its subscribers from feature phones to advanced smartphones, setting a date the coincides with the iPhone 5 release. Sprint already sells high end Android phones and operates an expensive 4G network, but those devices make up a relatively small share of its subscriber base.
Picking up Apple's iPhone would likely dramatically change Sprint's subscriber mix. This summer, Verizon revealed that it sold more than twice as many iPhones as it did 4G phones, despite an advertising blitz promoting its new 4G service.
Sprint appears similarly inclined to leverage the popularity of the iPhone to upgrade its subscribers to more sophisticated smartphones. The company has also announced an event on October 7 to provide a "Strategy Update," and Apple has posted jobs throughout 2011 apparently related to supporting a Sprint iPhone.
The company itself has told employees simply not to offer any comment on its plans to support iPhone 5. but the Wall Street Journal was confident enough about its sources to report that the next iPhone would in fact be carried by the company in tandem with Verizon and AT&T at its launch.
Analyst Gene Munster of Piper Jaffray has stated that Sprint could sell 6 million additional iPhones for Apple in 2012, based on a comparison with the shift to iPhone that Verizon experienced.
The policy change, noted by blog SprintFeed, goes into effect just weeks before Apple is expected to launch iPhone 5. Sprint is rumored to be among the US carriers that will carry the new phone.
Sprint previously charged its subscribers $200 to escape their subsidized service contract early, an amount prorated over the term of the contract. By boosting the fee to $350, Sprint will now be in the same ballpark as AT&T and Verizon, both of which hiked their fees to accommodate the shift from subsidizing cheap feature phones to subsidizing much more expensive smartphones.
AT&T's early termination fee was originally $175 for Apple's iPhone, the first widely popular phone costing around $650. The fee was intended to prevent customers from buying an iPhone as part of a contract and then abandoning the contract. Previously, expensive smartphones in the price range of iPhone were carried only by a minority of US customers.
At the end of 2009, Verizon raised its own smartphone early termination fee to $350 as it began to market Droid-branded phones running Android to replace flagging sales of Blackberry devices. The next spring, Google and T-Mobile launched the Nexus One with a $550 early termination fee, sparking scrutiny from the U.S. Federal Communications Commission.
Last summer, AT&T also raised its early termination fee on advanced devices like the iPhone to $325. AT&T's smartphone mix is now predominantly made up of iPhones, and Verizon's iPhone subscribers are growing fast enough to substantially knock down the carrier's share of Android phones within the US.
Sprint's own early termination fee hike suggests that it too will be focusing on moving its subscribers from feature phones to advanced smartphones, setting a date the coincides with the iPhone 5 release. Sprint already sells high end Android phones and operates an expensive 4G network, but those devices make up a relatively small share of its subscriber base.
Picking up Apple's iPhone would likely dramatically change Sprint's subscriber mix. This summer, Verizon revealed that it sold more than twice as many iPhones as it did 4G phones, despite an advertising blitz promoting its new 4G service.
Sprint appears similarly inclined to leverage the popularity of the iPhone to upgrade its subscribers to more sophisticated smartphones. The company has also announced an event on October 7 to provide a "Strategy Update," and Apple has posted jobs throughout 2011 apparently related to supporting a Sprint iPhone.
The company itself has told employees simply not to offer any comment on its plans to support iPhone 5. but the Wall Street Journal was confident enough about its sources to report that the next iPhone would in fact be carried by the company in tandem with Verizon and AT&T at its launch.
Analyst Gene Munster of Piper Jaffray has stated that Sprint could sell 6 million additional iPhones for Apple in 2012, based on a comparison with the shift to iPhone that Verizon experienced.
Comments
I haven't read any statistics to suggest that the ratio of smart vs. feature phones on Sprint is radically different than AT&T or Verizon though. The Evo 4G set the standard and the bar for Android phones when it was released.
What's more telling is that T-Mobile hasn't done this yet. Seems less likely they'll get the iPhone this go around with the oddball 3G frequency.
Except their 3G is AT&T's 4G (their REAL 4G. LTE, not the whoring they're doing now), so it will eventually get 1700MHz.
Makes complete sense. They're all colluding anyway; might as well make all of their prices equal across the board.
Now THAT would be something the FTC and DOJ would be all in their schiz about...
Let's see if we can find a new way to piss off/screw our customers...
... what's next... the prison "visitors room" setup they have at some CableCo stores -- where you are separated from the "guards" by 3"-thick "bullet-proof" glass and exchange things through a slide-out drawer.
The customer is always wrong... No Exceptions!
Although I have no doubt that the iPhone coming to Sprint is a huge factor in this decision, let's not forget that the timing of this ETF rate hike comes one day before the introduction of the Samsung Galaxy SII Epic 4G touch which is also a very expensive phone. Sprint already has the Evo 3D and Motorola Photon, both dual core and expensive phones, so I think this was to be expected. With a $200 ETF, you could actually make money by selling a new smart phone on Ebay.
I haven't read any statistics to suggest that the ratio of smart vs. feature phones on Sprint is radically different than AT&T or Verizon though. The Evo 4G set the standard and the bar for Android phones when it was released.
I haven't seen data from this year broken out, but a year ago AT&T was selling ~15 million iPhones while Verizon was selling about 7 million Blackberries and 7 million Android smartphones, while Tmobile and Sprint were each only selling less than 4 million smartphones of any flavor.
So despite being about half the size of Vz and ATT, TMob and Sprint had a much lower smartphone mix than AT&T. Like Verizon, they want to grow their smartphone subscriber ratio and keep subscribers from churning. AT&T has largely been protected by the iPhone's attraction.
Thank god they own the number of towers they do or they would have been gone
long ago. Sprint is the epitome of a company who's CEO has zero understanding of a productive business model or understanding on how to implement one.
I really wish that Google would get into the Broadband / Internet game. Google has the ability to put a good product to market using a fair pricing structure. I'm so sick of the weekly changes in terms, conditions & pricing that the big 3 constantly bombard us with, all of which just add money to their pockets while making us suffer.
I haven't seen data from this year broken out, but a year ago AT&T was selling ~15 million iPhones while Verizon was selling about 7 million Blackberries and 7 million Android smartphones, while Tmobile and Sprint were each only selling less than 4 million smartphones of any flavor.
So despite being about half the size of Vz and ATT, TMob and Sprint had a much lower smartphone mix than AT&T. Like Verizon, they want to grow their smartphone subscriber ratio and keep subscribers from churning. AT&T has largely been protected by the iPhone's attraction.
I would do a little better research. Unless Sprint is lying, 60% of Q4 in 2010 were smart phones and I have heard those numbers have even gone higher in 2011. I also really doubt the numbers in that chart. If that were true, it would appear that Sprint had less than 2 million smart phone sales until August of 2010 and I know that to be false.
http://newsroom.sprint.com/press_kit...presskit_id=21
Thank you.
Can someone tell and confirm that when Verizon goes full LTE -- LTE provides multi-tasking as AT&T has? And right now AT&T and T-mobile are the only phones that can be used outside of the United States? True or false?
Thank you.
I think you meant using voice and data at the same time instead of multitasking. Yes, you can do that now with any LTE phone on Verizon or WiMax phone on Sprint, and any phone on WiFi for data. Sprint is upgrading their CDMA to 1X advanced and I believe so is Verizon. That would allow voice and data simultaneously over CDMA.
There are plenty of world phones on all carriers. So that is false. My old HTC Touch Pro 2 on Sprint even had a SIM slot and could be used in GSM countries abroad.
Go F**K yourself.
That is all.
It sure would be nice if Apple stepped up and bought either T-mobile or Sprint (or both, for that matter)...
But they're both worthless? And don't serve any purpose for Apple to own.
While the "Big 4" provide coverage over a large part of the urban parts of the country, in certain parts only the next tier providers actually provide the full coverage in the rural areas. Apple should not abandon these consumers to Google, RIM or Microsoft -- open up the carrier pool to these next tier quality providers!
If Apple is adding Spring and T-Mobile -- it is time they really open up availability and allow the next tier providers such as U.S. Cellular (that dominates markets in the Midwest -- and who will have 4G coverage in their markets before AT&T will) to sell the iPhone as well.
Apple already sells an unlocked GSM iPhone to cover all GSM smallies.
All they have to do is sell the iPhone 5 unlocked to cover everything.
My AT&T contract for my iPhone 3GS ended on August 29th so I am a free man.
Extra green in the pocket and no more contracts. My bill is about $8.33 a month for a few minutes of talk time and $5.00 for 200 texts. Sure, many folks could never live with such a skimpy plan, but hey I am saving about $66.00 a month now.
If more people would simply walk away from these big data plans and outrageous texting plans (go iMessage, Google Voice and GoChat to name a few) then these telcos would feel the pinch, but too many people have blinders on and think they NEED a smartphone.
If Apple is adding Spring and T-Mobile -- it is time they really open up availability and allow the next tier providers such as U.S. Cellular (that dominates markets in the Midwest -- and who will have 4G coverage in their markets before AT&T will) to sell the iPhone as well.
While the "Big 4" provide coverage over a large part of the urban parts of the country, in certain parts only the next tier providers actually provide the full coverage in the rural areas. Apple should not abandon these consumers to Google, RIM or Microsoft -- open up the carrier pool to these next tier quality providers!
Can't disagree. Cricket, etc., si! iPhones for anyone who can generate useful signal.....