Sprint "Simplicity" Demand is Really "Protect Me" Demand

Sprint bases much of its retail pricing strategy on "simplicity." Some might say that is another way of saying "no worry about overage charges. The strategy is well founded, in the Internet access era. Some will not be able to remember it, but America Online, even before that firm began calling itself AOL, and before it decided to essentially abandon the ISP business, used to charge users by the minute.

When AOL switched to "unlimited" usage, freeing users from the need to deal with metered access, usage exploded. For that reason, fixed broadband service plans in the U.S. market have been "unlimited" until quite recently.

That approach generally has not been used in the mobile business, which has more stringent capacity issues. Sprint, for the moment, remains the carrier most associated with "unlimited" access plans. Some Yankee Group research data from the United Kingdom shows the continuing power of the "don't worry about overage charges" approach. About 29 percent of U.K. consumers surveyed indicated they were willing to pay a 10-percent premium to receive protection from unexpected overage charges.

They also were willing to pay more for higher speeds, especially when available "on demand."