The era of unlimited mobile data has been in rapid decline over the past few years. It turns out that consumers really like using mobile broadband and that wireless companies really like making money, and when the two go hand in hand the whole “unlimited” thing doesn’t really work out in business’s favor as much as “charge for data” does. Sprint has been trying to attract new customers by fighting against that tide, but even the top exec of the company now says that’s ultimately likely to be a losing battle.
That’s what Sprint CEO Marcelo Claure told audiences at the Code conference this week in California. Sprint, which is the country’s fourth-largest wireless provider behind T-Mobile, AT&T, and Verizon, started pushing new unlimited data plans as recently as last August — but they’re not going to be able to last forever.
The main reason Sprint has to work so hard to bring new customers on board these days is because, bluntly, their network is terrible. The data speeds are slow and unreliable, and so using a significant amount of data at will, as subscribers are generally accustomed to being able to do with AT&T or Verizon, is just not going to happen. And Claure acknowledged that reality.
“That’s fair,” he told the Re/Code moderator who said, basically, that Sprint’s network sucks. “I’ve been in this job for eight months and when I came, you were right, our network was absolutely drop-dead last.” But, Claure continued, serious upgrades are coming: “You can expect in the next 18 to 24 months, hopefully inviting me here two years from now, that our network will be ranked number one or number two.”
But upgrades take money, and change the equation.
“Unlimited is not forever. Let’s be very clear,” Claure said. “The better content, the better services, they’re going to consume more data.”
“For now,” he continued, “unlimited works very well. User consumption is below our cost of producing data. But in the future, we might increase the cost of unlimited or we might eliminate unlimited at one point in time. Today, our customers have a choice. … Obviously, if we’re going to build a great network, in which you’re going to have great video from all the different partners that we have, the unlimited equation doesn’t work. But for now, it works very well.”
Sprint CEO: Unlimited Data Is Great but It May Not Be Here to Stay (Video) [Re/Code]
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