Will Free Global Roaming Help Sprint Corp. Fend Off T-Mobile U.S. Inc.?

It's not a big move, but it's likely to delight any customers who can take advantage of the offer.

Daniel B. Kline
Daniel B. Kline
Apr 15, 2015 at 4:00PM
Technology and Telecom

T-Mobile (NASDAQ:TMUS) CEO John Legere has made his intention to pass Sprint (NYSE:S) and become the No. 3 U.S. wireless carrier. It's possible that has already happened, but it doesn't really count until both deliver their next quarterly report.

At last count, as of February, Sprint still had a slight lead at nearly 56 million customers, with T-Mobile ending the same period at around 55 million. The difference is that T-Mobile has been surging and added over 8 million customers over the course of the year (which ended for the company with the February quarter).

"2014 was the best year of growth in company history," said Legere, who can never pass up a chance to boast or take a shot at his competition. "Our Un-carrier moves helped us blow away the competition. The best is yet to come as the future looks bright in 2015."

Sprint has been doing better than it was before Marcelo Claure was named CEO, but it's still losing ground to its chief rival. That may be why the company is pulling out all the stops and attempting to offer value to customers that make them consider switching from Sprint or even industry leaders Verizon and AT&T.

Source: Sprint.

What is Sprint doing?
Sprint's latest offer is to give customers free international roaming. That matches something T-Mobile already does but AT&T and Verizon do not.

The company's new play gives customers "the ability to travel to major areas in Latin America, Europe, and Japan and roam with up to 2G speeds to read emails and surf the Web at no additional charge," the company announced in a press release. Subscribers can also send unlimited text messages for no extra charge, and they can call anywhere in the world from the included countries for $0.20 per minute. 

Though the plan is free, customers still need to activate it to receive the benefits, which can be done at Sprint's website or by visiting a Sprint store.

Eligible countries for "International Value Roaming" are Argentina, Brazil, Chile, Costa Rica, El Salvador, Germany, Guatemala, Japan, Mexico, Nicaragua, Panama, Russia, South Korea, Spain, and the United Kingdom.

"The continuous feedback from our customers indicates how important it is to travel without the fear of high roaming charges," Claure said. "So we launched free data roaming and Wi-Fi. Latin America, Europe, and Japan are only the beginning. We will continuously add new countries to ensure our customers can use their device virtually wherever they travel."

Will this matter?
This isn't a major change for Sprint, but for the people it will affect, it's likely to enhance their brand loyalty and keep them locked into Sprint. Many of the company's customers aren't likely to travel to the countries included very often, but when they do, they are likely to appreciate this service.

It's important for Sprint to keep pace with its low-cost rival, T-Mobile. It's equally important for the company to offer things that its more expensive rivals AT&T and Verizon do not.

This is not a game changer, but it's the exact type of incremental improvement Sprint should be making as it tries to fend off T-Mobile and steal share from AT&T and Verizon.