* Virgin to charge $649 for iPhone 4S
* iPhone service fee $35/month; $30 for autopay customers
* Sprint shares rise almost 1 pct to $2.74
June 7 Sprint Nextel Corp said on Thursday
its Virgin Mobile prepaid business would start selling Apple
Inc's iPhone later this month, pitching it against
smaller prepaid rival Leap Wireless International Inc.
Sprint shares closed up almost 1 percent after it said the
addition of the iPhone to its Virgin brand would not hurt its
2012 earnings and would help it reach its overall $15.5 billion
commitment to Apple for a certain phone volume over a few years.
Virgin customers, who do not commit to a contract and pay
for calls in advance, will pay more than three times the price
for an iPhone that Sprint contract customers pay. Contract
customers get a big discount in exchange for staying with Sprint
for two years.
Virgin customers will pay $649 for the iPhone 4S, compared
with $200 for Sprint contract customers.
Wells Fargo analyst Jennifer Fritzsche questioned how many
Virgin customers, who tend to be more cost conscious, would be
able to afford the steep price, even as she said Sprint priced
the product to minimize risk.
Sprint said Virgin would start selling the device on June
29. Leap Wireless said on May 31 it would start selling iPhone
on June 22. Leap will charge less than Virgin for the device,
but its monthly service fee is higher.
Virgin's service plan for iPhone customers will start at $35
per month and customers can get a $5 discount if they register
for automatic monthly payments, bringing the service price down
to $30. This compares with the $55 per month minimum for
customers of Leap Wireless.
Sprint shares closed up 2 cents at $2.74 on the New York