Sprint Corp. unveiled a new "all-in" pricing plan Tuesday with a campaign featuring David Beckham. And then someone read the fine print.
Sprint Tuesday began offering consumers an $80 "All In" pricing plan that includes $20 lease payments on a handset and $60 for unlimited text, phone and data services; it also ended its $70-a-month unlimited service plan. The offer expires Aug. 6.
But later the same day, the company released a statement saying that it would remove video-streaming limits it had set for the new plan. That came after some consumers read the fine print and noticed that the deal included a clause saying Sprint would throttle online video with a maximum video speed of 600 kilobytes per second at all times -- "a speed that's little better than what you'd get on dial-up," according to the Washington Post.
"Some consumers raised concerns about a 600 kbps limitation – and we are acting immediately to address these concerns," said the company in a statement Tuesday night.
"At Sprint, we strive to provide customers a great experience when using our network. We heard you loud and clear, and we are removing the 600 kbps limitation on streaming video," said CEO Marcelo Calure in the statement, which included this caveat: "During certain times, like other wireless carriers, we might have to manage the network in order to reduce congestion and provide a better customer experience for the majority of our customers."
Sprint, which has lost subscribers for seven straight years, has become one of the most aggressive price cutters with promos like "cut your bill in half." Such efforts spearheaded by Mr. Claure helped Sprint add customers in the first quarter.
Still the No. 3 U.S. wireless carrier, Sprint is struggling to make network enhancements and improve service quality for users. These upgrade costs have raised questions about the company's finances. Sprint reported $914 million in negative cash flow in its fiscal fourth quarter ended March 31.
Sprint's new $80 plan is still lower than T-Mobile U.S.' comparable offering. T-Mobile, the fourth-largest carrier, sells leases on iPhones and unlimited service for $95 a month.
"When consumers ask carriers what their all-in price is, it will be apparent Sprint offers the best value," Kevin Crull, Sprint's chief marketing officer, said in an interview with Bloomberg.
~~With Bloomberg News~~