Sprint Looks to Undercut Apple iPhone

Samsung's soon-to-be-released Instinct smartphone, which its U.S. marketer Sprint (S) hopes will be its Apple (AAPL) iPhone killer, will have a new, lower price when it goes on sale this Friday -- a penny less than $130.

(Click here for my video take.)

The Instinct, which I reviewed last week, was originally planned to sell in the $250-$300 range. But as soon as Apple announced its $199 price for the high-speed, next-generation iPhone 3G, Sprint let it be known that the Instinct would also sell for $199.

But alas, the Instinct is no iPhone. And although it's a nice phone in its own right, it doesn't match up well with the soon-to-be-unleashed iPhone 3G.

Sprint understood all too well what that would mean for sales, and today lowered the price to $129.99, with a $100 mail-in rebate and a two-year service contract.

Sprint needs the Instinct to help bring up sales levels. Sprint was the first to bring the $99 Palm Centro to market. That phone has been very successful for both companies. AT&T (T) and Verizon (VZ) also sell $99 versions of the Centro.

The Instinct has now been priced just a few dollars more than the Centro (although that $100 price has always been the price point dividing line for mass market cell phone sales).

Sprint has said that it is going to spend more than $100 million to market the new touch-screen device, which is about three times the marketing budget of its biggest phone launch in 2007.

A flood of new smartphones is expected in the next few weeks, including Research In Motion's (RIMM) Blackberry Bold; Garmin's (GRMN) nuviphone; what used to be known as Google's (GOOG) gPhone (new smartphones that run on the open-source Android operation system) ; and Sony (SNE)Ericsson's (ERIC) Xperia (a Windows Mobile smartphone) and lots more.

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