updated 09:30 am EST, Tue January 18, 2011
Sprint raises smartphone data prices to build 4G
Sprint today said it was raising the prices of data on all smartphones by $10. The "Premium Data" fee it had previously charged only for 4G phones like the Evo 4G and Epic 4G will now count against 3G smartphones for anyone activating a phone after January 30. It raises the minimum cost of using voice and data with a smartphone on Sprint to $80 per month, making it the most expensive.
Customers can't be grandfathered in and will see the rate hike even if they simply switch smartphones.
The company justified it as a necessary tradeoff to both maintain its unlimited plans while upgrading its network to "meet the growing appetite" for Internet access. It noted that smartphone users chew about 10 times more data on average and pointed to AT&T's capped 2GB plans as justification. A truly serious smartphone user would face overages and pay significantly more on AT&T, Sprint insisted.
While its plans are still competitive when text messaging is factored in, AT&T and Verizon customers can now pay as much as $25 less if they don't require significant data or text messaging. T-Mobile also still has unlimited data, although it has a "soft" cap of 5GB beyond which it reserves the right to throttle traffic if the local cell sites are oversaturated.
The move may be to offset the possible fallout from Clearwire's financial troubles. Although Sprint has taken steps to reduce the amount of collateral damage should Clearwire go bankrupt, its dependence on Clearwire to help build its WiMAX 4G network has left it vulnerable should the partner fail out. Sprint itself has only just shown signs of a significant recovering after picking up phones like the Evo 4G and is still losing hundreds of millions of dollars even as it begins to recover subscribers.
Most of its recent success has been credited to Android and the success of its 4G phones in particular. It may still face added competitive pressure from the Verizon iPhone stealing customers and may need to brace its network should a Sprint iPhone become a reality.