Sprint Challenges Verizon, AT&T

Sprint is joining the war of words between top telecoms with new work underscoring the fact that its $69.99 per month wireless plan includes data as well as voice services. Competing plans from AT&T and Verizon cover voice services only.

Sprint’s push, from Goodby, Silverstein & Partners, features CEO Dan Hesse explaining that most people use their cellphones to do more than just make voice calls. He adds that while Sprint’s $69.99 monthly plan includes data features like Web browsing and texting, AT&T’s and Verizon’s $69.99 plans do not. One ad, which broke this week, attempts to drive home the point that “Our $69.99 is worth more than their $69.99.”

After debuting last September, Sprint’s plan coincided with a slowdown in subscriber losses for the fourth quarter of 2009. Sprint lost 148,000 subscribers that quarter compared to 545,000 in the previous quarter. In response, AT&T and Verizon introduced their $69.99 plans in January, which appeared to level the playing field since many consumers likely assumed that all the plans were the same. That’s what prompted the new ad.

“This campaign will resonate with consumers by showing all the additional benefits consumers get beyond just calls with Sprint’s $69.99 plan. In today’s economic environment customers are interested in more than just voice pricing. They also want the best value for all the other things they rely on their wireless phone for and Sprint delivers,” said Mike Goff, vp, corporate marketing, in a statement.

Will it do Sprint any good? Roger Entner, head of telecom research for the Nielsen Co., said that AT&T and Verizon are in such a commanding position in the market right now that they are unlikely to respond to Sprint. “They have the luxury of being able to ignore [Sprint],” said Entner, who noted that both AT&T and Verizon added millions of new subscribers in the fourth quarter.

The two telecom titans have offered their own clarifications to each other’s campaigns since Verizon rolled out an ad last October pointing out gaps in AT&T’s 3G coverage. AT&T then sued Verizon over the ad, alleging that consumers interpreted the dead spaces on the map as areas with no voice coverage, rather than no 3G availability. AT&T later withdrew the suit and introduced ads with Luke Wilson countering Verizon’s claims.

Entner said that, at the moment, AT&T’s exclusive deal to offer Apple’s iPhone is a big factor in that company’s subscriber growth, but Verizon’s growth is largely based on the perceived reach and strength of its network. Said Entner: “The perception of having the best network is really pulling them through.”

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