In the race of who can attract the most subscribers and keep them onboard in the mobile phone world, Sprint is crawling! Their subscribers are leaving by the thousands, and because of that, their employees are forced to leave in the thousands as well. In a News Release dated January 18th, Sprint says that in the fourth quarter alone, they experienced a loss of 683,000 post-paid subscribers (meaning those with monthly service plans and contracts) and 202,000 pre-paid users. In all, they saw 885,000 subscribers walk out the door and head to other services.
What happens when such a large number of people leave? Well, the obvious. They don’t need as many employees to deal with customer’s needs, and they don’t need as many retail stores. Sprint is expected to kick 4,000 employees to the curb and close 8 percent (or 125) of their retail locations, and 4,000 third-party distribution points. All of these changes should be complete by the end of the first half of the year. By doing this, they’re hoping to reduce their labor costs by $700-$800 million by the end of the year.
So who and what is to blame for this decrease? Well, first of all, Sprint themselves are partially to blame. Remember all of those contracts they canceled because the users were calling too much? I think the iPhone is partially to blame too. People who wanted the iPhone bad enough were willing to cancel their contracts with other service providers like Sprint to head over to AT&T. With the popularity of the iPhone, I think every mobile provider has had a difficult time.
It was just two weeks ago that Ryan and I ended up calling Sprint to cancel our service. We’ve both been Sprint customers for years, but after multiple customer service issues, we decided not to renew our contract when it ran out at the beginning of January and head over to AT&T. One such issue was being charged per KB for Internet usage when we were supposed to have had an Internet plan. By the time we realized it, we had racked up over $100 in Internet usage. Calling customer service was useless– they said they couldn’t do anything about it! It took calling and asking to speak with the CEO before we could actually get connected with someone who was able to fix the issue.
Ryan made the phone call to cancel two week ago and it was clear that they were willing to do just about anything to keep us as subscribers. Here’s what they offered (all of which, we declined):
- Three months of service for free if we stayed with them (this would be tempting for a lot of people, but they were also banking on the fact that we’d forget to call back and cancel)
- We declined the first offer- so they said we could give the phones to friends to use the three free months
- A plan to use direct connect only
- Keep the phone number active for $5 per month in case we wanted to come back
Definitely not a good start to the year for Sprint!