Sprint announces rate cuts to be paid for by job cuts

Jose Castro – Fourth Estate Cooperative Contributor

Overland Park, KS, United States (4E) – In a recent announcement, Sprint is now offering its data customers up to 20gb of data. Included in the new deal is 10 lines for just USD100. This offer doubles the previous packages offered by the company, a clear price cut which is the current trend in the telecommunications market.

The announcement was made by Sprint Chairman Masayoshi Son. He said the offer now being made is the most competitive and value laded for Americans in the current market. The offer would be available to current subscribers by the end of this week, Aug 22.

Another telecommunications company, Verizon had earlier cut its prices for its unlimited text and call plan. T-Mobile, another competitor, is expanding its family lines to six. As a whole, more and more cuts are expected in the coming months.

What do these price cuts mean for the company? For Sprint, this balancing act falls on the lap of its new CEO Marcelo Claure. Just four days into his job, he announced that his proposed pricing plan would reverse the exodus of Sprint customers in the last few months. Among the features of this new plan is lower rates as well as larger data allocations per consumer.

Hidden in the plan is the way Sprint would recoup these price cuts and they would job cuts. This job reduction program is part of the overall plan to become a more efficient company. There were no specific numbers as to the pink slips to be handed out, but they are sure to be handed out for this quarter.

He announced previously to the Sprint company workforce, “When you have a great network, you don’t have to compete on price but when your network is behind, unfortunately, you have to compete on value and price and that is what we will do.”

He added, “I want to make sure we’re the incumbent challenger, I don’t want the status quo.”

The status quo it seems is T-Mobile, after its CEO John Legere announced that his company would move past Sprint this year in terms of subscription. Legere also claimed that T-Mobile has become ‘the top prepaid wireless company’ in the United States. He boasted 15.64 million users, compared to Sprint’s 15.19 million. With these numbers, T-Mobile becomes the third largest carrier, just ahead of Sprint.

Legere added via Twitter, “I predict the #uncarrier will overtake @Sprint in total customers by the end of the year! There, I said it!”

In response, Sprint CEO Claure said its new rates would be ‘simple and attractive’, as well as further develop the company’s large spectrum holdings in order to improve its network and at the same time increase efficiency to decrease overall costs.

In a statement, Claure said, “In the short term, we will focus on becoming extremely cost efficient and competing aggressively in the marketplace. While consolidating makes sense in the long term, for now, we will focus on growing and repositioning Sprint.”

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