Next month, Sprint (s) will begin offering data plans for tablets in lower capacities and prices, hoping to attract tablet owners who don’t need much data in a given month. On Nov. 11, the carrier will add both a 100 MB and 1 GB data plan as a special contract offer and is waiving any activation fees for the new plans. Sprint says that the new plan offerings — priced at $10 and $15 per month, respectively — provide 20 percent more data than a comparably priced plan from either Verizon(s vz) or AT&T(s t).
The news follows Sprint’s quarterly investor call, where it reported quarter sales of $8.7 billion for the quarter, coupled with a net loss of $767 million or 26 cents per share. On the earnings call, Sprint CEO, Dan Hesse was asked about raising rates and said, “We certainly would be in a better position to do so if we felt we had a strong, competitive network.” Therein lies a big part of Sprint’s challenge and partially why it’s offering tablet plans at lower prices. As Hesse noted on the call, Sprint is at a “temporary disadvantage” when it comes to its partially deployed 4G network.
Unlike AT&T and Verizon, Sprint was late to choose LTE as its 4G technology. Instead it began launching a WiMAX network with Clearwire(s clwr) in 2008, which is slower than today’s LTE networks and took too long to build out. The company has since changed gears and is in the process of rolling out an LTE network. The other issue is the carrier’s 3G technology, which is used for data in the many coverage areas that don’t yet have LTE. Sprint promises speeds up to 3.1 Mbps; far slower than AT&T’s — or T-Mobile’s, for that matter — HSPA+ network. Right now then, Sprint provides slower service in most of its coverage areas when compared to its peers.
By offering smaller plans that are less expensive than the current tablet plans, Sprint may be able to keep some of its current customers from defecting to the faster networks as it continues its LTE network build. Current Sprint customers with these plans can add the new plans to their tablets: Simply Everything, Simply Everything Share, Everything Business Everything Data, Everything Data Share, Business Advantage Messaging & Data, Business Share Plus with Pro Pack Plus. On a per-Gigabyte basis, the new plans may look expensive, but for Sprint smartphone owners that only need a sip of tablet broadband, a smaller glass may prove attractive.