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Sprint Undercuts Apple IPad, Verizon With Samsung Tab

Sprint to Offer Samsung Tablet for a Third Less Than Verizon
An attendee tries the new Samsung Galaxy Tab tablet computer. Photographer: David Paul Morris/Bloomberg

Oct. 25 (Bloomberg) -- Sprint Nextel Corp., trying to undercut rivals in the tablet market, will sell the Samsung Electronics Co. Galaxy Tab for $200 less than it costs on Verizon Wireless’s network and $229 less than the iPad.

Sprint will offer the Galaxy Tab starting Nov. 14 for $399.99 with a two-year wireless-data contract. Verizon Wireless is offering the Tab for $599.99, and Apple Inc. sells its lowest-priced iPad that can connect to a mobile-phone network for $629, though in both cases customers are not required to sign up for data contracts.

Sprint, the third-largest U.S. wireless carrier, aims to capitalize on the surging tablet market and gain an edge on Verizon and AT&T Inc. The Galaxy Tab is one of the first tablet devices to challenge Apple, which sold 4.19 million iPads last quarter. AT&T is the exclusive carrier for the iPad -- as well as Apple’s iPhone -- though Verizon plans to sell a version that relies on a Wi-Fi connection to access the Net.

“This is designed to move market share in Sprint’s favor and is a very compelling offer,” William Vogel, an analyst with Merlin Securities LLC in New York, said in an interview. He has a “buy” rating on Sprint shares.

Sprint is offering the device, which uses Google Inc.’s Android operating system, with data plans of $29.99 per month for 2 gigabytes of data or $59.99 for 5 gigabytes of data, according to a statement today. Verizon has a $20 plan for 1 gigabyte of data monthly and AT&T offers 2 gigabytes monthly for $25 on the iPad.

Smaller Screen

The Tab features a 7-inch screen, compared with the iPad’s 9.7-inch display. It also has cameras on each side for video calling and can work like a mobile phone.

Dell Inc., Research In Motion Ltd. and Motorola Inc. have all announced plans to release tablets, which are generally lighter than laptops and rely on touch screens.

AT&T also has said it will sell Samsung’s Galaxy Tab, though pricing details aren’t yet available, said Mark Siegel, a spokesman for the Dallas-based company. Reid Walker, a spokesman for Deutsche Telekom AG’s T-Mobile USA, also declined to say how much the company would charge for the device. T-Mobile USA is the fourth-largest U.S. carrier.

Sprint, based in Overland Park, Kansas, slid 10 cents, or 2.1 percent, to $4.75 at 4 p.m. in New York Stock Exchange composite trading. The shares have added 30 percent this year.

To contact the reporter on this story: Greg Bensinger in New York at gbensinger1@bloomberg.net

To contact the editor responsible for this story: Peter Elstrom at pelstrom@bloomberg.net

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