Sprint to cut mobile phone song price to 99 cents

Sprint cuts its digital music download fee to match prices at iTunes in a challenge to the leading Internet music service.

ORLANDO, Fla.--Sprint Nextel plans to cut its digital music download fee to 99 cents per song, matching prices at iTunes, the leading Internet music service run by Apple.

Sprint, which announced the move Monday, a day ahead of the CTIA Wireless 2007 trade show here, is the first of the top three mobile phone service providers to offer this price, which will go into effect in early April. It currently charges $2.49 per song.

The price cut is an about-face for Sprint, which has long maintained that consumers are willing to pay a premium to buy songs on the go. It has sold 15 million wireless song downloads since it launched its music service in late 2005.

By comparison, iTunes has sold more than 2 billion songs since its inception in 2003.

Current Analysis analyst Avi Greengart said the price cut should help Sprint win new music customers. He said bigger rival Verizon Wireless, a venture of Verizon Communications and Vodafone Group, would probably follow suit.

Verizon Wireless charges $1.99 for each wireless song purchase including a copy for the customer's desktop computer. Sprint said its 99-cent fee includes a copy for the user's desktop computer.

The move by Sprint, which also announced a slim new music-playing phone from Samsung Electronics, comes ahead of Apple's launch of its iPhone in June. The iPhone will go on sale exclusively at Sprint's biggest rival, Cingular Wireless, which is being rebranded as AT&T.

One side of the Samsung phone, dubbed the Upstage, has a big screen that takes up most of the phone and keys dedicated to the music player. On the other side is a typical phone keypad and a much smaller screen.

The phone also comes with a slim case that can be used to charge it or can serve as a spare battery.

Greengart said that while the Samsung phone is innovative, it is not in the same league as the iPhone.

"It doesn't challenge the iPhone in any shape or form," said Greengart, who pointed to the iPhone's touch-screen interface with a computer-like keyboard.

The iPhone will go on sale at Cingular for $500. Sprint is charging $149 for the Upstage for customers who sign up for a two-year contract.