Sprint Readies Unlimited-Data Push For Apple iPhone 5
If Apple (AAPL) ships an iPhone 5 that runs on 4G LTE wireless networks this fall as expected, Sprint Nextel‘s (S) marketing mantra will look a lot different than those of rivals.
Verizon Wireless and ATT (T) own the nation’s biggest 4G LTE data networks. Sprint is just getting started with its LTE rollout. So with a smaller network, Sprint aims to sway consumers by offering unlimited data plans.
Verizon and ATT have stopped selling unlimited data plans to new customers. Some smartphone users gobble up so much network bandwidth that they need to be reined in, say the wireless firms.
Sprint is betting that its unlimited wireless data plans will result in more people walking through its doors rather than walking past its stores. AP View Enlarged Image
Sprint, though, has stuck with unlimited data plans, aiming to woo smartphone users that download a lot of video and rich content. IPhone users consume the most data, so Sprint hopes its unlimited offering will strike a chord with iPhone 5 buyers.
“When the iPhone 5 comes out, if we get it and when we get it, we’ll offer unlimited (data),” Steve Elfman, Sprint’s president of network operations, confirmed to IBD.
ATT has sold iPhones since Apple released its first such product in 2007. Verizon first sold the popular devices in February 2011. Sprint followed in October.
Apple hasn’t confirmed any plans to release an iPhone 5, let alone whether it will run on LTE (long-term evolution) networks or which wireless firms will sell it. But analysts expect a new iPhone, and they expect all the big carriers will get it.
“I don’t see a scenario where Sprint won’t get an LTE-capable iPhone at the same time as Verizon and ATT,” said Bernstein Research analyst Craig Moffett. “The problem is they will be so far behind in their LTE network when the iPhone 5 comes.
“ATT and Verizon will be much further along, with much better spectrum, offering higher speeds. That could make a Sprint iPhone a tough sell to consumers, especially if LTE-capability is the cornerstone feature of the next iPhone.”
The stakes are big.
“We expect the iPhone 5 this fall to include LTE and drive what we expect to be the largest iPhone upgrade (cycle) thus far,” said Wedbush Securities analyst Scott Sutherland, in a report.
Keeping customers from defecting to rival carriers will be a key part the battle.
Contracts Up For Renewal
Some 9 million ATT customers bought iPhones and signed two-year service contracts in the second half of 2010. With those contracts ending, ATT will have a sizable chunk of customers up for grabs as the iPhone 5 hits store shelves, analysts say.