Sprint Price Cut or Shell Game?

Category: Mobile

Sprint says “Bring us your Verizon or AT&T bill and we’ll cut your rate in half” for the same service. Whenever a phone company makes you a simple, compelling offer, you’d better read it carefully; then have a lawyer read it too. Let’s unravel the truth in Sprint’s brand-new “half price” offer...

Will Sprint Really Cut Your Bill in Half?

At first glance, it appears that Sprint's Cut Your Bill in Half offer saves new customers 50% off their monthly mobile phone bill. But there are some rather complicated Ifs, Ands, Buts, and Maybes. And one "sort of" too. Your 50% could be 20%, depending on which Sprint executive is speaking.

First, Sprint will reduce only the service portion of your plan: the cost of calling, texting, and data. Whatever line fees you’re paying now will remain the same, as will the taxes and fees.

Additionally, you have to turn in your Verizon or AT&T phone(s) to Sprint, sacrificing their potential resale value and getting no trade-in allowance. (I predict a surge of interest on eBay for broken phones.) On the other hand, Sprint will waive the $36 activation fee, and pay up to $350 worth of your early-termination penalty or remaining installment payments for the device(s) you turn in. But you have to buy new device(s) from Sprint at unsubsidized (no contract) prices.
Sprint Cut Your Bill in Half Offer

You can pay for your new list-price device(s) up front, in installments, or using one of Sprint’s new iPhone for Life leasing plans, if you want an iPhone 6 or 6 Plus. I spent 5 minutes trying to understand all the details and options of this plan, and failed. You might want to bring an accountant, as well as an attorney, when discussing this with your friendly local Sprint rep.

T-Mobile customers in the USA are not included in this offer. That’s probably because T-Mobile’s rates are already comparatively low; half of them would be a losing proposition for Sprint.

It's a "Sort Of" Discount

The bottom line is that your savings will be much less than fifty percent of your Verizon or AT&T bill. “They are still probably getting a 20 percent sort of net discount,” CFO Joe Euteneuer said at a Merrill Lynch conference shortly after the new promotion was announced. Publicly-traded telcos do this sort of two-faced tap dance where they woo customers with huge discounts while assuring investors that profits are not going to suffer much. It can be difficult to tell whose leg is being pulled harder.

Euteneuer went on to tell investors that Sprint's Family Share Pack plans, which for the same price double the data allowances of Verizon and ATT plans when customers switch, have been drawing new customers. “The whole idea is to attract people back into our stores,” said Euteneuer, where sales reps can assure potential customers that Sprint’s network quality and coverage really has improved over the past 18 months.

How the sales reps are supposed to do that remains unclear. I looked at some Sprint 3G/4G coverage maps and found that outside of most metro areas, there are gaping holes in coverage. That's especially true West of the Mississippi.

Other financial analysts (remember when phone service didn’t need a financial analyst?) say that the “half off” promotion will be compelling only to customers who are on legacy Verizon and AT&T contracts. Savings on those companies’ newest EIPs (equipment installment plans, e. g., Verizon’s Edge and AT&T’s Next plans) will amount to only $10 to $30 per month depending on the number of lines involved, “and comparable pricing to Sprint's existing Family Share Pack plans.”

BTIG analyst Walter Piecyk opines that Sprint’s half-off promotion “is attractive if an AT&T or Verizon customer was in the market to get new phones for all the users on the account and they were comfortable with the current state of Sprint's network.” I wonder how many people fit that description.

Pain Versus Gain

The bottom line seems to be that you'd need to visit a Sprint store, and go over your account in detail to see if there are any potential savings. You'll need to know what plan you currently have with AT&T or Verizon, how many minutes and how much data is needed monthly, and what phones are currently in use by family members.

Of course there is some pain involved in switching phones, too. You'll need to make sure your contacts, photos, text messages and apps all make the journey from one phone to another. And as I mentioned before, there's the cost of purchasing all those new Sprint phones at unsubsidized prices. The iPhone 6 and Samsung Galaxy S5 both retail for about $650. A family of four would need to cough up $2600 or spread out the cost over 24 months.

Half price, anyone? Your thoughts on this topic are welcome. Post your comment or question below...

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Most recent comments on "Sprint Price Cut or Shell Game?"

Posted by:

Don Stalter
09 Dec 2014

Another word of caution: Sprint has a history of subterfuge. Slamming your telephone bill is one of their most popular tricks.

Posted by:

Ken Mitchell
09 Dec 2014

Sprint "deals" are generally no deal. I'm a current Sprint customer (or at least, until my already-ordered T-Mobile Nexus 6 phone arrives) and have been with Sprint since they acquired Nextel, and was with Nextel before that.

Bob, I nominate your sentence "I looked at some Sprint 3G/4G coverage maps and found that outside of most metro areas, there are gaping holes in coverage." for the "Understatement Of The Year" award. Sprint coverage, even IN major metro areas, stinks. Calls are routinely dropped, data connections are slow, and customer support gets worse day by day. Don't ask why I've stayed with them as long as I have; laziness, I guess.

When it comes to Sprint, I'm out.

Posted by:

09 Dec 2014

Hello Bob: I think MAYBE https://republicwireless.com/ might be the Best Deal on the Internet for Smart Phone service at the LOWEST Cost . But I do NOT know how Good their Quality of Service is. Example ; is the VOICE CLEAR from every State that you live in? I am VERY Tempted to Try out their services .

EDITOR'S NOTE: See my recent article about Republic Wireless. http://askbobrankin.com/will_hybrid_phone_service_save_you_money.html

Posted by:

09 Dec 2014

And I will bet that the sprint sales rep talk about saving you all that money with a straight face.

Posted by:

Daniel Wiener
09 Dec 2014

We have a 5-person Sprint family plan with 1500 shared "anytime" minutes, free cell-to-cell, unlimited everything else (including data) and every two years each line is eligible for a $150 discount towards a new phone.

We are very happy with this plan and are grandfathered into it. But I don't think Sprint is enthralled with it, since they keep offering to switch us to one of their new "improved" plans. The new plans all have data caps of some sort. Recently I received a mailer from Sprint saying that because I was such a loyal and valued customer they were giving me some exclusive new benefits: (1) Talk without limits. (2) The latest phone for only $5 per month, which we then turn in after two years for a new one. (3) Free 12 months of service on every new line we add to our account.

But we only use about half of our anytime minutes now, so we don't need "talk without limits". We can currently PURCHASE the latest phone every two years for effectively less than their new $120 lease rate (which requires you to turn in your old phone). And we don't need a new line, especially one with an introductory special which will cost more later on. Furthermore, it would mean we'd be transitioning to a new plan to take advantage of these benefits, thus losing some old benefits. So we're standing pat.

Posted by:

Arnold Christensen
09 Dec 2014

Remember the old days of used car salesmen? They are reincarnated as cellphone companies. I will stick to my Tracfon with triple mins that carry over and do everything that needs to be done. Try them when your term is up.

Posted by:

09 Dec 2014

suddenlink here in eastern NC does similar "deals", like sprint does. i would like to change providers, but there are no other choices... there are none without paying a lot more. [it's called a "negotiated" contract with the city -- ha!] keep up the good work bob. i love >everything

Posted by:

09 Dec 2014

I consider T-Mobile as a perfectly balanced choice in terms of price, quality, quality of customer service and "big fat cat behavior" of a big company like ATT or Verizon. Now I have $30 no-contraсt plan with 1500 minutes/SMSs and 30Mb data and absolutely satisfied with that. I know, 30Mb data is nothing, but there are plenty places with free Wi-Fi and I always have it at work and home. Also GSM gives you more freedom to pick a phone you like and go overseas with your own phone since it's a piece of cake to switch SIM-card to a local provider and avoid crazy roaming fares. Of course, there are some differences in frequency sets, but for basic services they usually works wherever you go. In contrary, even Vodafone, who owns 45% of Verizon is inaccessible for Verizon's phones (at least it was a couple of years before). Same sh*t with Sprint phones - they should be GSM-compatible and unlocked. At that point of view there are two options only - ATT and T-Mobile. But everybody knows what a piece of work ATT is... Those thoughts kill any type of marketing...

Posted by:

09 Dec 2014

I recently looked into Sprints "unlimited data plan" It only applys to when you are using their towers. If you use data on an other companys towers you pay. Read the fine print in their plans carefully.

Posted by:

09 Dec 2014

Sprint still has serious gaps in coverage. They do not have any coverage in Omaha, Nebraska, where I live. Anyone who travels a lot needs to check Sprint's coverage area before going with them.

I'm sticking with Verizon.

Posted by:

09 Dec 2014

I am a very happy Consumer Cellular customer for over 3 years. No contract required; good choice of phones; low prices plus bargain plans for light users; very good coverage (uses AT&T's network minus their poor customer service)! Why bother with the others?

Posted by:

10 Dec 2014

I highly doubt, that Sprint could lower anyone's prices! There, usually is some legalese, in very, very fine print ... Saying, the complete opposite of what they are trying to sell everyone. This honestly goes, for EVERY Mobile Phone Service!!!

Bottom line, IF, the Mobile Phone Services do NOT make any profits ... How can they even run a business??? For me, profit is what makes a company being able to be in business, in the first place. Staying in business, also, means profits.

While, I am really not pleased with AT&T, overall, part of my distaste comes from ALL of the Federal & State Taxes added, to my bill!!! Another thing AT&T does, that almost all of them do ... Claim that should you "upgrade or try a newer plan", than you will be charged XX amount of dollars, per phone. So, you do it and maybe, a year or even 6 months later, you add another phone and told that the XX amount of dollars plan, was for ONLY those phones that were on the plan, when you "upgraded or changed to a new plan!!!"

Again, they are basically ALL the same ... Liars and thieves. They charge WAY too much, for the phones that they offer and then, "soak" you some more, on any of the plans, you chose.

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