Sprint Offers Free 1 Year Service Tempts Verizon’s Customers

Sprint Corp is offering free unlimited data, talk and text for one whole year with an aggressive promotion launched on Tuesday, aimed at Verizon’s customers, in an over-flooded U.S wireless market.

Sprint, the fourth largest U.S wireless carrier, has tried various ways to attract customers in recent years, but this one may be the it boldest play yet.

Current postpaid subscribers at Verizon, AT&T, and T-Mobile are  eligible for the deal and it also covers family plans. Customers who switch to Sprint before June 30 and bring their own devices will get free service until July 31, 2018. After that, Sprint’s regular rates for unlimited plans will be applied, at $60 per month for a single line. Sprint said that there is no requirement to change numbers and that it will let up to five switch lines over at once.

First, you will actually have to pay a monthly $1.99 admin fee and $2.99 for a SIM card, as well as taxes on all that, so the term “unlimited” is not completely free. For the most part, you will get 4G LTE data, but speeds are capped at 8Mbps for gaming streams, 1.5Mbps for music and videos can transmit at up to 1080p. Data deprioritization applies during times of congestion, and customers that exceed 23GB of data in any billing cycle may be throttled until the next billing cycle.

Moreover, unlimited talk includes long distance calls within the United States and Sprint Global Roaming, which includes 2G data and text messaging in over 165 countries for no charge, plus calling for $0.20 per minute. A 10GB of high-speed data per line is included to use toward Personal Hotspot, VPN, and Peer-to-Peer usage.

Verizon customers who plan to switch will need to own one of a select number of pre-approved devices, and all phones would need to be unlocked, or able to be used on a network other than Verizon’s. Among the list of eligible phones are the iPhone 6, 6 Plus, 6S Plus, 7 and 7 Plus, Google Pixel and Pixel XL and unlocked versions of the Samsung Galaxy S7, S7 edge, S8 or S8+.

Craig Moffett, an analyst with MoffettNathanson, noted on Tuesday that, “It’s hard to imagine that regulators will be tempted to imagine anything much better than giving away services for free.”

Sprint’s survival depends on boosting its subscriber numbers, as well as finding a merger partner like T-mobile US Inc. or a cable company to help around its prospects.

The deal is a”targeted pilot,” an experiment focusing particularly on Verizon customers who already own their devices and are not necessarily looking to upgrade or change carriers. Those who look to make the switch will have to do so online, and not through one of the company’s retail stores, according to David Tovar, Sprint’s Senior Vice President of Corporate Communication.

“We’re trying to get people to stop and consider Sprint,” said Tovar. This offer “gives them a really compelling reason to do so.”

However, the company also is not expecting an immediate return from this offer. Tovar said Sprint is expecting “low surface revenue”, meaning the company is not hoping to make a lot of money from this offer. But the bottomline is that after the 12 months, customers will like the experience and see “no reason to switch back to another carrier,” said Tovar.

Sprint firmly sits in fourth place among the major U.S mobile carriers in terms of total subscribers. Verizon and AT&T have faced declining growth as of late, but still have big bases of subscribers to sell to. T-mobile, meanwhile, has surged in recent years on the back of aggressive discounts and marketing, passing Sprint along the way. Sprint’s network continues to be seen as lagging behind its peers, too.

Verizon fell 1.5% and both T-mobile and AT&T lost 1%.

By 7:10PM GMT-4, Sprint Corp traded 0.61%, or 0.05, to $8.26. It opened in $8.24, with a session high of $8.32 and a session low of $8.22. Its market capitalization was 33.33 billion.

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