OT>> Long-distance price wars intensify
November 6, 1998
NEW YORK (Reuters) Price wars for
long-distance calls intensified Thursday as
Sprint Corp. , the nation's third-largest
long-distance company, introduced a new
plan that offers unlimited weekend
long-distance calls for a flat rate of $25 a
month.
Rival AT&T Corp. , the nation's largest
long-distance company, quickly countered,
saying other calling plans provide greater
savings but still offering to match Sprint's
plan for any of its customers.
The No. 2 long distance company, MCI
WorldCom Inc. did not immediately return
calls seeking comment.
Subscribers to Sprint's new plan will also will
receive a flat weekday calling rate of 10
cents per minute, 24 hours a day, Sprint said
in a news release.
''Industry research shows that Saturday
and Sunday are the two single highest calling
days for consumers,'' Sprint Consumer
Services Group President Tom Weigman said.
''Sprint Unlimited meets this trend head on,
going beyond the price per minute standard
of today to introduce a new paradigm in the
U.S. residential long distance arena --
unlimited, unrestricted calling for a single flat
monthly rate.''
AT&T said the Sprint plan is not best value
for customers since the average monthly
long-distance bill is about $17.
''Sprint's hefty $25 monthly fee locks
consumers into making many calls at a
specific time - weekends - to break even,''
said Jack McMaster, vice president of AT&T's
consumer markets division.
AT&T contends that its ''One Rate Plus - 5
Cent Weekends'' calling plan would offer a
better value to consumers. AT&T said it
would match Sprint's offer for any of its
customers.
Industry analysts said if the Sprint Unlimited
plan is successful, long-distance companies
may shift to all-you-can-use, flat-rate
pricing plans for the entire month.
Long-distance service is increasingly
becoming a negotiable commodity that
companies may offer at extreme discounts to
entice customers to buy more lucrative
packages of services that include Internet
access and wireless phone service, analysts
said.
Shares of Sprint gained 69 cents to $77.94 a
share, while AT&T added $1.69 to $61.88.
Both trade on the New York Stock Exchange.
REUTERS@
[Copyright 1998, Reuters] |
