Sprint: Next-Gen Data Services Should Be Affordable

Sprint Corp. says its PCS wireless unit will price data services lower than rival offerings from Verizon Wireless or AT&T Wireless when they launch this summer. Sprint hopes that more affordable pricing will spur the use of wireless data services that are now rolling out.

Kevin Packingham, senior manager of business marketing at Sprint, told Unstrung about his company’s pricing plans as he unveiled Business Connection Enterprise Edition, a corporate wireless email application powered by technology from Seven Networks Inc. The product will be available when Sprint’s new CDMA 1xRTT network service kicks off later this year.

Packingham says Sprint is trying to learn lessons from the limited high-speed services that rivals Verizon and AT&T have already launched (in wireless terms, "high speed" means transfer speeds somewhere between a 28 kbit/s and 56 kbit/s). Verizon is charging customers $35 a month to download up to 10 Mbytes of data, while under AT&T Wireless's "Mobile Internet Plan," 5 Mbytes of data can be downloaded onto a handset for $30 a month. But both firms then charge between 50 cents and a dollar for each additional kilobyte downloaded over the montly allowance. If the user does not opt for one of these prepaid plans, the costs for additional data usage can rise rapidly, with carriers typically charging around $20 per Mbyte.

"Current services are priced a little too high for most enterprises to adopt them," Packingham says. "We’re going to be sure to price the service so that users don’t have to be ticking away kilobytes in the back of their heads as they’re downloading data," although he added that exact details of the pricing schemes are still being hammered out.

How much exactly will Sprint charge? Company officials aren't saying. But analysts say they may bundle large amounts of data at an attractive monthly fee.

"I wonder if they’re going to offer an all-you-can-eat package," says Amit Nagpal, senior consultant with the U.S arm of Analysys Consulting Ltd. He speculated that this may be a $70 to $80 deal that allows enterprise users to download as much data as they want. "This would certainly be one way to stimulate usage," Nagpal says. "Of course, the risk for the carriers is that their networks will get overloaded."

The pricing of the first wave of high-speed data services from U.S and European carriers has become something of a bête noire. (See Reports Slams GPRS Prices, It's I-mode, Jim, But Not as We Know It, GPRS Prices: The Readers Have Their Say, and Commentary: Cut Those Crazy GPRS Prices!.)

Recently, analysts from both Gartner/Dataquest and Analysys have said that the high cost of mobile data services is holding back their adoption by corporate customers and consumers alike. It will be interesting to see exactly how low Sprint will go and how its rivals will react. "The proof of the pudding will be in the eating," comments Nagpal.

Of course, offering a cheap wireless data pipe is pointless if the users have nothing worth downloading, hence Sprint’s deal with Seven, one of companies on the current Unstrung 25 list.

The Sprint service will enable companies to send and receive email wirelessly between a Notes or Exchange server and the user’s handset. The Seven software allows carriers to host an email service and route email directly through the pre-selected SSL ports in a corporate firewall. If a company wants more security, Sprint is offering to route the service over a frame relay pipe or via leased private line. Sprint already offers a similar service, based on the Seven software, for consumers-cum-mobile professionals, as does Cingular Wireless.

The low cost and ease of setup are the main advantages of using the hosted system. Packingham claims that this offering will be much cheaper than buying a wireless email system, such as that offered by Research In Motion Ltd., which consists of a behind-the-firewall server that routes email to dedicated BlackBerry email pagers. Such a system costs a lot to install and needs a full-time IT commitment to maintain it, Packingham claims.

— Dan Jones, Senior Editor, Unstrung
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