If Sprint’s Q1 2016 operating results are any indication—and they really should be—the US wireless carrier is on the rise. A part of that success can definitely be attributed to the company’s so-called “half-off” promotion which cuts its customers existing rate plans at competing carriers by half and has proved to be incredibly popular among consumers. More specifically, Sprint has revealed that it has attracted no less than 173,000 of new post-paid customers in Q1 2016 alone. That’s quite an increase for a company that reported a loss of 12,000 subscribers in the same period last year. Well, if you’re thinking about becoming a part of those numbers, i.e. jumping carriers and taking advantage of Sprint’s popular promotion, it’s recommended you don’t bide your time for too long as the fourth largest carrier in the country is apparently planning to increase its existing prices in the coming weeks.
As hinted by Sprint’s CEO Marcelo Claure during a call with journalists earlier today, the carrier will introduce a new set of rate plans before the iPhone 7 hits the market this year. Given how Apple usually releases a new iteration of its flagship smartphone in mid-September, that means there’s not a lot of time for people to jump carriers and cut their existing rate plans in half at Sprint’s expense. And that expense is anything but small as Sprint has posted a $302 million operating loss during the promotion period, much bigger than the $20 million deficit reported last year. Claure still insists that this promotion was necessary as Sprint had to reignite customers’ interest in its services after a long period of less-than-stellar wireless services.
It’s worth noting that Claure didn’t explicitly state that Sprint is increasing its prices before fall but there are only so many ways to interpret the announcement of Sprint adding “things that generate shareholder value,” which is exactly how the company’s CEO has put it. Experience tells us that shareholders’ happiness and consumers’ happiness are usually two mutually exclusive things. Speaking of which, these “value-generating” things that Sprint will soon introduce have been described by Claure as aggressive and “game-changing” so it’ll definitely be interesting to see what the company has in mind come September.
The carrier’s CEO has also commented on Verizon’s upcoming acquisition of Yahoo, stating that he sees this as an opportunity for Sprint to win over more post-paid customers from Verizon as the latter is slowly becoming more and more focused on its non-core businesses.