Sprint As You Go Unlimited Prepaid
In January 2013, Sprint announced that on the 25th of the month it would be launching its own Sprint As You Go prepaid brand. I have to say that “it’s about time!” I’ve been saying for years, even before Sprint bought Nextel (ok, they technical merged, however, in reality, it was a purchase), that Sprint should simply have their own prepaid offering. In my opinion, the prepaid market was just starting to gain interest (in 2003), and Boost hadn’t been in the market too long as a joint venture with Nextel (i.e. Nextel did not own Boost Mobile at the time). I felt that the money spent on building the Boost brand was a complete waste.
In reality, there was a pent up demand for prepaid Push-To-Talk (Nextel’s infamous walkie-talkie feature). Boost sales did extremely well, not because of any brand success per se, but rather because people wanted the walkie-talkie feature. However, they either didn’t qualify for the strict Nextel credit requirements, or they didn’t want a contract (for a number of reasons). A prepaid Nextel brand would have flourished just as much, if not more.
Anyway, Sprint later purchased Nextel and got Boost along with it. Their initial plan was to shut it down, however, its new unlimited offering was taking the market by storm and growth was tremendous. The “wait and see” strategy culminated in prepaid being such a massive growth engine for Sprint, that they purchased Virgin Mobile, and now are launching their own brand.
In reality, the cost of managing both Boost and Virgin likely doesn’t have a respectable business case. The fact is that people don’t really care about the brand per se.
We want a good phone selection, and good value on the plan pricing. Do we care whether it’s Boost, Virgin, or Sprint? No! In fact, Sprint arguably has always been a stronger brand that Boost and Virgin. The issue that Sprint is no doubt having at this point is that prepaid is so valuable to the company that they don’t want to disrupt that cash flow by jumping in with a Sprint As You Go prepaid brand too aggressively.
That’s my theory as to why they are launching with a limited (and wholly uninspiring) phone selection, and price points that are also pretty pathetic. It will be interesting to see how they do. If it’s successful, that would be really telling. In other words, seeing strong gross adds (i.e. new subscribers) with such a pathetic handset and plan selection, would tell them that they should push ahead. However, if the take rate is lack luster, that doesn’t necessarily tell them it’s a failure (again, due to the pathetic phones and plans).
The company speaks of not throttling customers on its new Sprint As You Go program after 2.5GB that was instituted in January 2013 with both Boost and Virgin. A current unknown is whether the Sprint brand will allow access to Sprint roaming partners. The other Sprint prepaid brands, including MVNOs, don’t have access to those partners, meaning that network coverage is not as good as their postpaid business. This has remained one of the only remaining benefits of being on a contract plan with them.
So, time will tell how this plays out, and rest assured that I will be keeping on top of it, and reporting back here!