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Connected: Cell phone providers offering more value
Saturday, September 03, 2005

With the kickoff of the merger of Sprint and Nextel, the combined company has been making noise. Some of the noise is superficial -- like the new look of its retail stores. But the new company also has made some enhancements to its service offerings.

In the past, the Sprint marketing team has been among the most creative. No longer trumpeting that you can hear a pin drop, it has turned to creative packaging such as its "Fair & Flexible" plans, in which the user can sign up for a specific cell phone plan; then, if he uses extra minutes in a particular month, he gets an automatic upgrade for that month to the next level plan. For individuals whose calling habits change dramatically from month to month, this could be a significant money saver, as it avoids typical high per-minute charges for excess usage.

The latest creative pricing twist by Sprint allows users to select the times of day that are peak; and which are off-peak -- within limits, of course.

You may have noticed over the past decade that peak hours for cell services seem to have expanded. What started with our traditional phone services as peak hours from 8 a.m. to 5 p.m. has over the years become 6 a.m. to 9 p.m. What started as a way to discount service for consumers without giving businesses those same discounts (because consumers can call round-the-clock, while businesses typically have heavy daylight calling patterns) seems to have morphed into a way to get more money from consumers who don't want to wait until 9 p.m. to make their calls.

The new Sprint service allows you to change that. If you're willing to pay an extra $5 per month, you can have off-peak hours start at 7 p.m. For $10, you can start them at 6 p.m. That could be a significant savings if you often rack up minutes in the early evening. Businesses can gain from this promotion, too -- especially if they have operations on both coasts, as the earlier off-peak charges allow them to make calls from the East Coast to West Coast businesses that are open three hours later.

When Cingular gobbled up AT&T Wireless, it was able to merge the networks, giving customers of both companies a better, wider-reaching coverage map. Unfortunately, it won't work that way for Sprint and Nextel customers -- at least not in the short term -- because the two companies use different technologies and radio frequencies.

But the merged company is providing its customers with a way to talk for free to other customers of the service -- whether you are traditional Sprint or Nextel customers. So if you use Sprint PCS, you can call a Nextel phone subscriber without paying a per-minute charge. That's similar to Verizon's IN network and Cingular's unlimited mobile to mobile minutes. Because it covers both sets of users, it becomes more valuable to the customer -- as he can call more people without charge.

It looks like cell customers can expect to get better cell phone values as various companies grow and competition gets sucked up by bigger companies. Both Sprint and Verizon recently have lowered the pricing on their fastest Internet services as more customers start to consider them as necessities instead of options. I see no reason the trend won't continue as the cost of technology comes down and the number of new users grows.

Now, if only we can find a company that gives us universal service throughout the country. Oh, that's our old phone system.

First published on September 3, 2005 at 12:00 am
David Radin is a Pittsburgh-based consultant whose daily nationally syndicated radio show can be heard locally on XM and Sirius. You can sign up for his tip letter, contact him and find previous columns at www.MegabyteMinute.com.