Sprint's iPhone-Only Plans Got Apple's Blessing
Sprint's new CEO Marcelo Claure recently told employees that his first day on the job was spent meeting with Apple CEO Tim Cook, the results from which have come to light now that the new iPhone has been announced.
Sprint Corp. (NYSE: S) will carry the same iPhone 6 as its competitors, but it announced some unique pricing plans this week. It will offer a $50 unlimited talk, text and data plan specifically for the iPhone 6. And it's promising an "iPhone for Life" option for those customers that chose to rent it for $20 per month, rather than own it outright. These customers will be able to upgrade their iPhones every 24 months for a new model. (See Apple's New iPhones Have 20 LTE Bands, VoLTE.)
Under iPhone for Life, that comes to $70 per month for unlimited data on the iPhone. If Sprint customers don't choose the leasing option, they can opt to pay the full cost up-front and own their iPhone, finance the device for $30 per month, or take the standard option to pay $199 on a two-year contract.
Speaking at the Goldman Sachs Communacopia Conference on Thursday morning, Claure spoke of the close relationship between Sprint and Apple and the vote of confidence that Cook has given Sprint by allowing the iPhone for Life deal. In the past, Apple has been the one to call all the shots.
"For Apple to stand behind something like that, they have to believe in it," Claure said. "We're using their name."
Claure was also jazzed about the fact that the iPhone will support Sprint's 2.5GHz LTE Spark network, which means it should be able to keep up with all the unlimited data usage with Sprint's best speeds and capacity. (See Sprint Promises 180Mbit/s 'Peaks' in 2015.)
As for the rest of his talk this morning, Claure spent the most time reemphasizing his top three priorities -- finding the right value in pricing, improving the network and reducing the cost to serve -- and the increased speed at which he plans to do all three. He also said every single dollar out of Sprint is now monitored, so more cuts are likely as all "nice-to-haves" go away. (See Sprint CEO: Price Cuts First, Best Network Next .)
Claure also promised to give onetime acquisition target T-Mobile US Inc. a run for its money, despite T-Mobile CEO John Legere's claim that it will overtake Sprint in subscriber numbers this year. "Every Monday, we look at what's working and what's not. If any carrier launches something that makes us uncompetitive, we'll react the same day," Claure said, citing Sprint's response to T-Mobile's phone buyback program as an example. (See T-Mobile Offers to Best Competitors' Device Trade-In Offers.)
And, while Claure is still clearly interested in M&A opportunities, it's no longer counting on T-Mobile or any other company to get it back on its feet. (See Sprint Drops Bid for T-Mobile – Reports .)
"This is a scale game," he said. "When your competitors are twice your size and it costs you the same to run the network, scale matters. However, you can't complain any more about that. You have to compete with what you have. We're going to make sure we're going to become disruptors in the industry."
— Sarah Reedy, Senior Editor, Light Reading