Sprint expected to undercut rivals' call plans

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The two largest U.S. mobile service providers, Verizon Wireless and AT&T Inc, on Tuesday unveiled $99.99-a-month plans for unlimited calls. T-Mobile USA went a step further by including text messaging in that price.

Sprint has yet to respond, but analysts say it could be considering an unlimited calling plan for as low as $60 a month in a bid to stem customer defections.

That could force AT&T and Verizon Wireless, a venture of Verizon Communications and Vodafone Group Plc, to cut their prices or face losing customers.

"Our bigger concern rests with Sprint's plans and the potential for future additional competitive responses," Robert W. Baird analyst Will Power wrote in a research note.

Verizon shares fell $1.58, or 4.5 percent, to $33.76 in morning trade on the New York Stock Exchange after falling more than 6 percent on Tuesday.

AT&T shares fell $1.49, or 4.1 percent, to $34.40, also on the NYSE, after closing down more than 5 percent on Tuesday.

Sprint fell 2.9 percent to $8.96 after closing down 2.6 percent on Tuesday.

UBS analyst John Hodulik cut his earnings, revenue and share price estimates for AT&T and Verizon, citing a belief that Sprint is considering launching an unlimited calling plan with a monthly fee of $60 to $80.

He said the share price declines on Tuesday meant investors already assume Sprint will sell an $80 plan. But he said Sprint's response may be even more aggressive.

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