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Sprint Nextel Corp. (NYSE: S) really hit on something back in January when it rolled out a $50 unlimited everything plan from its Boost Mobile prepaid brand. Customers could get nationwide unlimited minutes, texting, data and walkie-talkie for $50 a month.
Customers went nuts and started snatching up Boost Mobile phones and that plan by the thousands. Soon afterward, other prepaid competitors like T-Mobile and Virgin Mobile followed suit with cheap unlimited plans of their own.
While this kind of prepaid wireless is a great idea during an economic pinch like we're in now, Sprint Nextel was apparently not well prepared for the huge influx of new customers. As a result, the company is seeing some massive problems with its text messaging services, with many messages taking hours to receive via Sprint's aging iDEN network, a leftover from the Nextel acquisition of 2005.
Perhaps Verizon Wireless' Ivan Seidenberg was right -- Sprint Nextel could be killing itself here. While Sprint is still losing hundreds of thousands of contract wireless customers every quarter, the impressive gain it's seeing with Boost Mobile prepaid could turn out to be a disaster if the network that customer base rides on becomes swamped to capacity, as already appears to be happening. Sprint Nextel can't really afford to take a share price hit, as S shares sit at under $4.75 today.
Perhaps Verizon Wireless' Ivan Seidenberg was right -- Sprint Nextel could be killing itself here. While Sprint is still losing hundreds of thousands of contract wireless customers every quarter, the impressive gain it's seeing with Boost Mobile prepaid could turn out to be a disaster if the network that customer base rides on becomes swamped to capacity, as already appears to be happening. Sprint Nextel can't really afford to take a share price hit, as S shares sit at under $4.75 today.
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Reader Comments (Page 1 of 1)
12-31-2009 @ 11:10PM
patmurray12 said...
No kidding, they have problems... It's not even possible to re-boost your phone online, as they would have you believe is possible to do with a re-boost card. Nor can you do it via the 233 keystrokes from your phone, because it only accepts the 14-digit codes, not the paygo cards with 10-digit codes under the strip. Had sent several emails to Boost Mobile's 24-hr availability customer care people, but did not even get an auto-responder type of reply that they had received my message. In addition, I found out that they had my account all messed up. My mobile number was associated with someone else's information. I would have called their 800 number, but I use my phone for text only. I happen to be unable to speak. Telling them that in email didn't even generate a reply. Their problems are a lot bigger than their network being overwhelmed! I'll be getting a new phone with a new carrier tomorrow... and probably have to fight tooth and nail to get my $99 + $4.95 vendor's fee back from the 7-ELEVEN.
1-01-2010 @ 2:48PM
patmurray12 said...
Okay, I am a fair person - and want to say that this morning I finally got a message from the customer care center that solved my problem. The solution was nice to get, but the response time was mediocre...
But, really guys... how much trouble would it be to have an auto-responder let a customer know you got their email and are working on their problem and give a time-frame for resolution???
So, are you working on it - or just putting out fires? I'm here for as long as you are taking care of business - but gone if you don't.
2-10-2010 @ 10:12AM
James said...
Something to consider is who wrote these blogs. It's not in Verison's interest that Sprint does well. Not to mention that there is a Verison add right next to these blog posts. Come on guys...
2-23-2010 @ 3:32PM
Conradsands said...
Wireless Profit Margins:
Verizon Wireless = 45 percent
AT&T = 39 percent
Sprint = 18.2 percent
Now we know where Verizon and AT&T get all that money to run commercials 24x7 and pay out big executive bonuses -- the American consumer.
4-25-2010 @ 9:14PM
DrSpencer7901 said...
Based on my brother's recommendation, I gave Boost a try over 7 months ago when I was let out of my previous contract - I think its awesome. I love not having to worry about a contract and their $50 unlimited plan is a real money saver over my $110+ previous bills - no worry about overage fees from texting anymore.
The phone selection is much better than I expected and still pretty affordable. The Spring powered calling network is giving me pretty dependable coverage with the ocassional dead zone.
Speaking of dependable, Boost's parent company Sprint has a whole new program out that is really helping people get and keep a cell phone.
Their “Assurance Wireless” program is being in offered in five states and exclusively to low income, qualifying families and its an amazing deal. Qualifers can get both a phone and 200 minutes, with no fees or contract, for $10 a month with the potential to expand their program at. 10 a minute. While the program is new, I can only hope it will expand to more states and people who could also use a plan like this.
I might not be low-income, but the savings would totally help me. Times are tough and having a cell phone is a must so click here for Sprint president’s email address: http://assurancewireless.webs.com and let him know that everyone could use these savings.
6-14-2010 @ 1:20PM
Cynthie said...
Dr. Spencer!! SEriously I completely agree! How could sprint take advantage of us liek this? Not all of us are rolling in dough. I went to the store and Sprint convinced me to stay with them, meanwhile I have been paying 100 dollars a month to be with them when i could have been with Boost mobile the whole time. SAVING 50 dollars!!! I am so mad and I plan on writing the president.