Sprint CEO: We'll Lease Spectrum as Soon as Possible

Dan Jones
News Analysis
Dan Jones, Mobile Editor

Mobile spectrum and its uses -- now and in the future -- was in the air as the Sprint CEO talked network density and more at the Goldman Sachs Communicopia conference Tuesday. 

CEO Marcelo Claure told an audience of financial analysts in New York City that Sprint Corp. (NYSE: S) is planning to lease a tranche of its spectrum out to potential interested parties "as soon as possible."

"Before the end of the year, we're going to be able to use spectrum to finance the company," Claure said. When pressed he wouldn't say if that was the end of the actual year or Sprint's financial year.

"One of the two," he hedged.

This is not the first leasing agreement that Sprint has put together to try to get cash for the company without having to tap the high-interest debt market. It has already struck lease deals for used devices and its network equipment. (See Sprint Inks $1.2B Deal for Sale & Lease-Back of Devices and Sprint Setting Up New Entity to Fund Network.)

Claure didn't say how much spectrum would be leased. It is expected to be a tranche of 160MHz-plus holdings of 2.5GHz spectrum it holds in the US.

This spectrum is coming sharply into focus now for Sprint as the company gets into the zoning and approval stage of densifying its network with lots of new small cells. "We've filed a lot of requests... We're getting a lot of approvals," Claure stated.

The rollout has involved figuring out where to put new "macro, femto" and "small cells" on the Sprint network to get maximum bang for the buck.

"We're rolling out tens of thousands of [new] gear," Claure said. "By the end of 2017... 2018... I want our network to be number 1 or number 2 in 80% of markets."

This will mean that capital and operating expenses for the network will increase, the CEO admitted. He, however, proclaimed himself confident that "new technology" and the work that Sprint has done will ensure that it can keep costs down.

Spectrum will also be a top priority as Claure takes on the role as the new chair of the CTIA . He said that his focus will be bandwidth, backhaul and establishing standard zoning and permit rights for 5G radios.

He suggests that the federal government will have to take more of a role in zoning rights -- and possibly controlling backhaul costs -- as small cells become the radio of choice for 5G.

"So that it's not hit or miss depending on what city or county we go to," Claure said. Some city mayors and local governments have been "forward thinking" in where they allow small cell radios to be deployed; some, not so much.

"The foundation of 5G is predicated on a very dense network," Claure said. This could literally mean a radio on every street corner as 5G becomes widespread in the 2020s.

Incidentally, Claure did confirm that the newly launched Apple Inc. (Nasdaq: AAPL) iPhone 7 is able to take advantage of one new update in the Sprint network. Sprint has just launched three-band carrier aggregation (3CA) in Chicago and is planning to roll it out across the network. (See Apple iPhone 7 Rides LTE-A Speed Curve to 450 Mbit/s.)

3CA bonds together three separate radio channels -- all at 2.5GHz in Sprint's case -- to increase data speeds and network capacity. Claure said that 3CA has been delivering data downloads of up to 260Mbit/s in tests. (See Sprint Ups the 4G Speed Ante to 230 Mbit/s.)

— Dan Jones, Mobile Editor, Light Reading

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