Making deals with Spotify and HTC, Sprint’s latest pitch is better music

04/30/2014 9:35 AM

04/30/2014 9:35 AM

Sprint is kicking up the beat in mobile music.

Customers using the wireless carrier’s Sprint brand are in for a free trial with digital music service Spotify. And the company cut an exclusive deal for HTC’s newest phone that promises to play music at “above CD quality.”

The announcements came Tuesday in an invitation-only New York event shortly after Overland Park-based Sprint reported its first-quarter results, which included a much smaller loss than a year ago.

Pitching a better music experience could help Sprint appeal to a younger audience.

Sprint’s move also comes as its smaller rival T-Mobile US has lured away its rivals’ customers with aggressive marketing tactics.

“This shows the importance of differentiation at a time when everyone is getting outshouted by T-Mobile,” analyst Avi Greengart at Current Analysis told Bloomberg News.

But analysts don’t expect the music to dramatically change Sprint’s ability to attract and keep customers.

“I think it’s a nice pickup for them,” said analyst Roger Entner at Recon Analytics. “I’m not sure people will switch their wireless carriers because they can get six months of free Spotify.”

Spotify, meanwhile, gains access to millions of new users with the potential for them to become customers. It has struck similar deals with wireless operators in other nations.

“Every market where we’ve partnered with a great telco provider, we immediately start growing in that marketplace,” chief executive Daniel Ek said. “We think this is huge.”

The service offers free music for users who accept ads and restrictions on playback. The premium service Sprint is providing its customers offers access to 20 million tracks for which Spotify normally charges $9.99 a month.

Sprint’s deal with Spotify will give a free trial to all of its customers buying service under the Sprint brand, though not its Boost, Virgin Mobile and Assurance brands.

The Spotify freebie lasts three months for most Sprint subscribers, but six months for those who sign up under its new Framily service plan. About 3 million customers have done that since it started in late March.

Framily is Sprint’s version of a friends-and-family plan. Members of a Framily (who don’t have to be related in any way) get price discounts with each additional member, with the discount maxing out at seven members. Plans can have up to 10.

After the Spotify trial, Framily customers still will get a discounted deal for an additional 18 months. The price — either $7.99 or $4.99 a month — depends on the number of Framily members that stay on Spotify.

In a way, Sprint’s Spotify deal is playing catchup. AT has had a deal with Beats Music since January.

Sprint’s offering also focused on playing music on an HTC One (M8) Harmon Kardon edition. Harmon Kardon is the company behind the Onyx Studio speakers Sprint offers.

This device is doubly suited to providing high-quality mobile music, said Ryan Sullivan, Sprint’s vice president of product engineering and development.

First, it carries the hardware, operating system and speakers for HD Audio.

HD Audio handles high-density audio files, which are becoming increasingly available. They can be 100 times larger than regular downloaded or streaming tunes, which have been compressed to send more easily.

Those larger files and the HD Audio mean a Sprint customer hears music “at the same quality that it was recorded in, so studio sound quality,” Sullivan said.

Even compressed files from streaming services and downloads will sound better on the new HTC device. It carries a Harmon Kardon app called Clari-Fi.

Sullivan said it analyzes the music and “rebuilds” its quality based on the changes typically made to compress music files.

Analysts said the high-fidelity pitch will help Sprint but have limits.

“They’re providing concert-hall-quality music that is being played in a train station,” Entner said.

Bill Ho, an industry observer at 556 Ventures LLC, said the restored highs and lows in music files will appeal to “musicphiles” but less to a general audience.

The Associated Press contributed to this report.

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