Sprint's Network Vision is about more than improving its network; it's the carrier's only way to reverse customer losses and hold on to its unlimited promise.

Sarah Thomas, Director, Women in Comms

March 10, 2014

3 Min Read
Sprint Sparks to Reduce Churn, Save Unlimited

Sprint's No. 1 priority this year is improving its network. It's a matter of keeping both its customers and its unlimited promise, the carrier's CFO said on Monday.

Speaking at the Deutsche Bank Media, Internet & Telecom Conference, Sprint Corp. (NYSE: S) CFO Joe Euteneuer reiterated the remaining steps in its Network Vision upgrade. The No. 3 US operator plans to complete the rip and replace of its 3G network by midyear, at which time it will also have 250 million PoPs covered with LTE. With help from its new owner SoftBank Corp. , it also plans to cover 150 million PoPs with 800 MGhz LTE and 100 million PoPS with its tri-mode Sprint Spark network by the end of 2014. (See Sprint Sparks It in Chicago and Sprint Plans Indoor, Outdoor Small Cells in 2014.)

Sprint needs to close the gap on its competitors in terms of network functionality, but it also needs to stop the customer bleeding. That's why Network Vision is so important, even if it's causing short-term pain. Euteneuer said that churn has gone up at the operator in markets where Network Vision is in the construction phase, but it tends to go down when it nears completion. (See Sprint Feels the Churn Burn Before Spark.)

In the markets where Network Vision is now at 70% construction or more and has been up and running for four months, Sprint has seen an improvement of 20-25 basis points in churn. "The realities are churn was high in the fourth quarter; it's going to remain high in the first quarter," he said. "If we're lucky, you might start seeing it [improve] in the second quarter, because we'll have so many cities down, but it's that balance of how many cities do you have over 70% complete for how long, and then you get the benefit of that reduction in churn."

The carrier, of course, also needs to work on adding more customers, but that's priority No. 3 behind its formidable network challenges. Euteneuer said Sprint would spend extra money in the first quarter to keep the "gross add engine going." (See Sprint Adds 58K Postpaid Subs in Q4.)

"When we look at the full year, we see the positive side of net adds in the later part of the year and suffering what this construction phase is, this portion to complete, as we finish it up through the first half of the year," he said.

Euteneuer also mentioned several times that Sprint has stayed true to offering unlimited data, even as pricing competition has increased, and it's something it wants to continue to protect. Upgrading its network will help it continue to do so from a capacity perspective. Sprint is also managing the network far tighter than it ever has before, including shutting down those "five to 10 people that decide they want to run server farms" pretty quickly. (See Sprint Launches No-Sharing 'Framily' Plans and T-Mobile Leads, Sprint Suffers in Pricing Wars.)

"We run that very, very tightly, and I feel good that unlimited does have some legs and longevity," Euteneuer said. "When you saw the announcement of taking over Clearwire, that gave us a lot more runway than we ever had before."

— Sarah Reedy, Senior Editor, Light Reading

About the Author(s)

Sarah Thomas

Director, Women in Comms

Sarah Thomas's love affair with communications began in 2003 when she bought her first cellphone, a pink RAZR, which she duly "bedazzled" with the help of superglue and her dad.

She joined the editorial staff at Light Reading in 2010 and has been covering mobile technologies ever since. Sarah got her start covering telecom in 2007 at Telephony, later Connected Planet, may it rest in peace. Her non-telecom work experience includes a brief foray into public relations at Fleishman-Hillard (her cussin' upset the clients) and a hodge-podge of internships, including spells at Ingram's (Kansas City's business magazine), American Spa magazine (where she was Chief Hot-Tub Correspondent), and the tweens' quiz bible, QuizFest, in NYC.

As Editorial Operations Director, a role she took on in January 2015, Sarah is responsible for the day-to-day management of the non-news content elements on Light Reading.

Sarah received her Bachelor's in Journalism from the University of Missouri-Columbia. She lives in Chicago with her 3DTV, her iPad and a drawer full of smartphone cords.

Away from the world of telecom journalism, Sarah likes to dabble in monster truck racing, becoming part of Team Bigfoot in 2009.

Subscribe and receive the latest news from the industry.
Join 62,000+ members. Yes it's completely free.

You May Also Like