When a struggling company does something right, you have to reward them for it. Otherwise, what was the point of criticizing their previously unacceptable business practices?
Sprint, in this case, has been rumored to be making another change in their push to redefine themselves as the premier wireless data provider in the US. Rather than aiming at the more competitive voice-call business in the US, Sprint has been banking on their more widely-available EVDO Rev. A data network and upcoming WiMAX data service to revive their ailing bottom line. Sprint’s WiMAX aspirations are still on the ropes as various wireless carriers and associations are petitioning the FCC to block, or at least delay, the Sprint and Clearwire merger that would bear the WiMAX-fruit that we’re all waiting for.
But, that doesn’t mean Sprint can’t make bigger changes in their other wireless data service. Sprint’s phone-as-modem plans (PAM) allow the user to use their mobile phones as, well, modems. Previously priced at $40 per month, the PAM plans are now rumored to be getting a huge price-cut. We’re hearing that Sprint is mulling a $15 per month price-point for customers looking to use their cellphones as wireless modems (tethered to their laptops, of course).
The move would most likely help Sprint increase their revenue, but may not necessarily increase their data ARPU (average revenue per user). While, ARPU is generally regarded as the key metric by which a wireless carrier is able to turn a profit, there’s something to be said for increasing your customer base on the same ARPU, as opposed to reducing ARPU while holding subscriber numbers constant.
Sprint would do well to drop their PAM plans. Sprint customers would be more willing to adopt the cellphone as wireless modem data plans, rather than violating Sprint’s Terms of Service by tethering their smartphone, with regular data plans, to their laptops. And, by increasing their appeal to heavy data users, Sprint could be one step closer to becoming the No. 1 wireless data provider in the US.
Note: I’ve said it time after time that Sprint would do well to redefine their business in to a more data-centric model, but that doesn’t mean Sprint’s voice-call business can being ignored. Data is more lucrative, and Sprint has the edge there, but voice is still king, and Sprint needs to improve that side of the business if they want to rise up past their No. 3 post.