Sprint's All-You-Can-Talk Offer

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The proliferation of unlimited wireless calling will contribute to the trend, he says. Mobile-phone companies "would very much like to compete with wireline—and win," says Mathias. Verizon shed 366,000 residential customer lines in the fourth quarter alone, many of them to mobile-phone carriers.

Taking Another Tack

Rival wireless carriers are likely to feel the impact, but it won't all be negative. An unlimited plan will probably cost less than the services sold separately, but many customers are currently paying less than that because they've opted not to purchase all of the services. Still, many customers will likely be willing to upgrade to an unlimited plan—at a higher cost than they're currently paying. "We are a big believer there's a segment out there that would pay a premium for that simplicity and predictability [offered by an unlimited calling plan]," says Stone of Amp'd, which sells its unlimited plans for $115 to $150 a month. By offering an unlimited plan, Sprint might actually be able to increase its average revenues per user, an important financial metric, by selling more expensive plans to more users.

Sprint Nextel could certainly use a growth boost. Sprint Nextel's network glitches and an ineffective ad campaign have contributed to its loss of 306,000 postpaid subscribers in the fourth quarter to rivals such as Verizon Wireless, Cingular/AT&T, T-Mobile USA (DT), and smaller service providers. Unlimited plans could help Sprint differentiate itself. Verizon Wireless and Cingular/AT&T trumpet network reliability. Historically, T-Mobile has pushed lower prices. Sprint has tried to advertise itself as doing both well, but so far hasn't succeeded, analysts say (see BusinessWeek.com, 2/6/07, "Mobile Services' Marketing Makeover").

Unlimited bundles are rife with risks, though. For one, comparisons among plans will be easier, keeping pressure on overall prices. So even as some customers upgrade to pricier plans, industrywide pricing will remain under pressure. Plus, people with unlimited plans would likely use their phones more—and put more pressure on the carriers' wireless networks.

Still, as competition for subscribers becomes more cutthroat, as U.S. wireless penetration reaches saturation, the more widespread adoption of unlimited calling is "inevitable," says Kaufman.

Kharif is a senior writer for BusinessWeek.com in Portland, Ore.