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Sprint Paid A Fortune For the iPhone
At Least $15.5 Billion in Four Year Deal
by Karl Bode Wednesday 29-Feb-2012 tags: business · wireless · wireless
When Sprint finally got the iPhone last fall, reports suggested the company paid an arm and a leg for the chance, reportedly doling out nearly $20 billion in a promise to buy nearly 30.5 million iPhones over the next four years. Sprint’s 10-K report filed this week confirms the fact that Sprint will pay at least $15.5 billion for the devices, and expects to see a significant hit on wireless profits thanks to having to subsidize the devices. It's enough to make the data hungry wonder when exactly Sprint will buckle and stop offering unlimited data. From the filing:

Click for full size
In September 2011, we entered into a four year commitment with Apple, Inc. to purchase a minimum number of smartphones, which on average, are expected to carry a higher subsidy per unit than other smartphones we sell. Our minimum commitment under this arrangement is approximately $15.5 billion; however, we expect our actual purchases will exceed this amount. This will result in an expected increase in cash outflow and reduction in operating income in the earlier years of the contract until such time as we may recover the acquisition costs through subscriber revenue.

While that's a lot of money for a company that's simultaneously working on completely re-configuring their network for LTE, the steep payout at least resulted in significant new subscribers last quarter for Sprint, who added 1.8 million new iPhone subscribers alone in the quarter. Roughly 40% of them were new customers to Sprint, many fleeing T-Mobile under fears of an AT&T acquisition.

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Kord

join:2006-10-27

IPhone

Seems to be the popular choice.

delusion ftl

@comcast.net

Re: IPhone

Actually it's not, Android has approx twice the marketshare in the US and in many other markets it's much larger.

Duramax08
Win8 sucks
Premium
join:2008-08-03
San Antonio, TX

Re: IPhone

Name all the androids. Now name all the iphones.

tc1uscg

join:2005-03-09
Saint Clair Shores, MI

2 edits

Re: IPhone

said by Duramax08:

Name all the androids. Now name all the iphones.

Bingo. Now name me an iphone that meets MIL-STD-810 standards or has direct connect (without using an app). That will much easier.

I'm sorry, but there is no phone, outside of the iPhone, that can bring in 1.8 million new subscribers in one quarter
That just proves that there’s 1.8 million people who can't be original or think for themselves. And if the droids have half the market, that proves your statement a little late or just wrong.

Ericthorn
It only hurts when I laugh
Premium
join:2001-08-10
Paragould, AR

Re: IPhone

Wrong post - removed
floyd007

join:2004-06-07
Richmond, VA
Reviews:
·Verizon FiOS
said by tc1uscg:

said by Duramax08:

Name all the androids. Now name all the iphones.

I'm sorry, but there is no phone, outside of the iPhone, that can bring in 1.8 million new subscribers in one quarter
That just proves that there’s 1.8 million people who can't be original or think for themselves. And if the droids have half the market, that proves your statement a little late or just wrong.

Sprint made a monumental mistake. 4 years?. They expect iPhone to be around in the same format 4 years from now? In tech land, even a year is a dinosaur. Apple and the iPhone most likely would at that time lost its luster and people would had moved on the latest and greatest. All Apple is doing is re-branding the same products year after year with "upgrades" they withheld from the prior version. I am surprised that they lasted this long with this "re-branding" of essentially the same products for years. I have no idea how Apple's products beyond one or two years continues to sell. Plus it is a proprietary system, the same mistake they made with Microsoft in the 1980s though Apple had the superior product back then. Google will eventually over take Apple with its open source as soon as one off the vendors make an extraordinarily mobile phone. Not if, but when. You can take that to the bank as well. Apple got lucky with this proprietary rubbish but all good things comes to an end. IMO open source in the future.
fiberguy
My views are my own.
Premium
join:2005-05-20
kudos:3

Re: IPhone

Jealous much?

Most everything you mentioned as a reason for Apple's "luck" and impending doom matters nothing.. comparing to microsoft in the 80's? .. doesn't apply here. "Google" will take over apple? You forget that Google doesn't make a phone, it makes an OS.. in fact it's attempt to make a phone kinda failed, so you're partially factual here. There has also been buzz that android had thought about pulling back on it's 100% open use.. still, just a rumor. Android is far with out faults.. it has a lot of compatibility issues between the OS itself and some hardware makers.. maybe not "compatibility" but some hardware doesn't work all that well with Android.

Simply saying that Apple is a closed environment isn't a cause of failure.. maybe to you, but there are millions of users of the iPhone that realize it and still move to apple because, as many say, "it's simple and it works".. but in the case of apple, it works rather well. So far it's worked very well for apple, millions of users are more than satisfied, and they keep coming back for more. AND spare all of us, as we've all heard it before, that "apple people are sheeple".. it doesn't matter, but maybe it does. They're "sheeple" because they're satisfied users. To YOU they are sheeple because they "blindly follow apple" (that's how you really feel, right??) but when it comes to the entire argument you're trying to make, it all boils down to the satisfaction of the customer in the end - and right now apple has the loyal following.. android can have "the numbers" all day long.

You state "as one off the vendors make an extraordinarily mobile phone"... they've had 4 years... and?? And then you state that apple hasn't done much to update their phone (which is bias rubbish, as you say) so what you're trying to say is that if someone else makes "the phone" then it's somehow okay while apple, who has gotten lucky and made a phone that they slightly update is somehow not okay?

Seriously just admit that your post is nothing more than cheer leading.
krazyfiend

join:2011-02-15

Re: IPhone

said by fiberguy:

You forget that Google doesn't make a phone, it makes an OS.. in fact it's attempt to make a phone kinda failed, so you're partially factual here.

The acquisition of Motorola Mobility is quickly forgotten I guess.
fiberguy
My views are my own.
Premium
join:2005-05-20
kudos:3

Re: IPhone

said by krazyfiend:

said by fiberguy:

You forget that Google doesn't make a phone, it makes an OS.. in fact it's attempt to make a phone kinda failed, so you're partially factual here.

The acquisition of Motorola Mobility is quickly forgotten I guess.

Nope.. haven't forgotten that one bit. So, let me forget most everything already said and base this post off of your last message.

"Google" didn't build the Motorola handset.. "Motorola" did.. they just bought an existing company. I can see your logic that since they "purchased" existing technology that they should be given retroactive credit for all past work. I can see that "google" has dramatically impacted the Motorola hardware in 6 short months.

.. sorry, no. Different owners,.. same team.

spewak
R.I.P Dadkins
Premium
join:2001-08-07
Elk Grove, CA
kudos:1
Reviews:
·SureWest Internet
said by tc1uscg:

said by Duramax08:

Name all the androids. Now name all the iphones.

I'm sorry, but there is no phone, outside of the iPhone, that can bring in 1.8 million new subscribers sheeple in one quarter
That just proves that there’s 1.8 million people who can't be original or think for themselves. And if the droids have half the market, that proves your statement a little late or just wrong.

There, fixed it for you.
--
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Ericthorn
It only hurts when I laugh
Premium
join:2001-08-10
Paragould, AR
said by Duramax08:

Name all the androids. Now name all the iphones.

Variety vs. be just like everyone else ?

cdru
Go Colts
Premium,MVM
join:2003-05-14
Fort Wayne, IN
kudos:7

Re: IPhone

said by Ericthorn:

said by Duramax08:

Name all the androids. Now name all the iphones.

Variety vs. be just like everyone else ?

What are you talking about? There's black AND white. And I think 3 different storage capacity. That's all the variety anyone needs!
fiberguy
My views are my own.
Premium
join:2005-05-20
kudos:3

Re: IPhone

said by cdru:

said by Ericthorn:

said by Duramax08:

Name all the androids. Now name all the iphones.

Variety vs. be just like everyone else ?

What are you talking about? There's black AND white. And I think 3 different storage capacity. That's all the variety anyone needs!

... right.. becuase that's what everyone looks at in a phone..

cdru
Go Colts
Premium,MVM
join:2003-05-14
Fort Wayne, IN
kudos:7

Re: IPhone

said by fiberguy:

... right.. becuase that's what everyone looks at in a phone..

It's called sarcasm.
fiberguy
My views are my own.
Premium
join:2005-05-20
kudos:3

Re: IPhone

ahh man! you forgot the required smiley. my bad.

Thaler
Premium
join:2004-02-02
Los Angeles, CA
kudos:3
Now name all the presidents.

Honestly, that point is meaningless.

Rob
In Deo speramus.
Premium
join:2001-08-25
Kendall, FL
kudos:3
said by delusion ftl :

Actually it's not, Android has approx twice the marketshare in the US and in many other markets it's much larger.

I'm sorry, but there is no phone, outside of the iPhone, that can bring in 1.8 million new subscribers in one quarter.

It's not about market share - it's about demand. Of course Android has a larger market share, there's oh so many Android based phones.
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delusion ftl

@comcast.net

Re: IPhone

You're logic is fatally flawed. IF the iphone had the most demand it would sell the most. The demand for android phones is higher. It may be spread amongst multiple manufactures but that's actually a good thing. Having only one iphone is a terrible thing (from a consumer's perspective)

Rob
In Deo speramus.
Premium
join:2001-08-25
Kendall, FL
kudos:3

Re: IPhone

said by delusion ftl :

Having only one iphone is a terrible thing (from a consumer's perspective)

Now that is a flawed logic. It doesn't seem to be hurting Apple, who's value keeps growing.
--
CheckSite.us | YourIP.us | Reverseip.us

Thaler
Premium
join:2004-02-02
Los Angeles, CA
kudos:3

Re: IPhone

said by Rob:

said by delusion ftl :

Having only one iphone is a terrible thing (from a consumer's perspective)

Now that is a flawed logic. It doesn't seem to be hurting Apple, who's value keeps growing.

Shooting to be #2 and having a nice fat profit margin is highly lucrative, especially if you design your goals to be such. I actually wish more companies would do this, rather than strive to be #1 within X amount of time, fail, and give up.
fiberguy
My views are my own.
Premium
join:2005-05-20
kudos:3
said by delusion ftl :

You're logic is fatally flawed. IF the iphone had the most demand it would sell the most. The demand for android phones is higher. It may be spread amongst multiple manufactures but that's actually a good thing. Having only one iphone is a terrible thing (from a consumer's perspective)

You're mistakenly confusing "demand" for availability. Apple was, for the longest time, limited to certain carriers - in case you forgot, there was only one carrier in the U.S. that offered iPhone for a few years.. Meanwhile, android was offered on many crap phones up to some pretty nice hardware on multiple carriers.

News flash, not everyone would subscribe to AT&T just to get an iPhone - some people flat didn't care for AT&T and wouldn't take an AT&T iPhone if it was given to them for free.

YOUR fatal flaw is that you think that everyone has to be or offer everything for everyone and that's just not apple. Hate it all YOU want, but apple chose to offer something DIFFERENT, which was, simply, to not be everything for everyone. (or did you miss that?)

What cracks me up are the number of people who are pissed at apple, or simply think they're a POS because they offer "one phone" in a take it or leave it model.. those same people bitch that apple isn't offering choice.. THEY ARE A CHOICE, in the marketplace that is.

Isn't it AWESOME that if you don't like the iPhone, you don't have to buy it? ... like it or not, the iPhone isn't going anywhere, it IS in demand, and in case you hadn't looked, they have more than enough PROFIT to show for their flaws. After the iPhone 4 "antenna gate" it seems that the 4S didn't suffer, did it?

... so please, tell me (and everyone) how again is having only one iPhone a terrible thing? (remember, iPhone is just one phone available in the entire market place, so the iPhone itself is a choice)

You cheer leaders need to get off the bandwagon that there has to be a winner and a loser - you can't make that argument when you talk about "choice"... cheer leading only leads to one thing - "someone has to win" which in turn means "someone has to lose".. do you REALLY want to see a loser here? No. So knock it off. Further, do you REALLY want iPhone to be like every other phone? .. WHY? ..what purpose does it serve? If you don't like apple, go to android - THAT is your choice.

Apple isn't suffering, no matter what android is doing.

Thaler
Premium
join:2004-02-02
Los Angeles, CA
kudos:3
Because as we all know, companies are only in business for one quarter, tops.

Duramax08
Win8 sucks
Premium
join:2008-08-03
San Antonio, TX
Reviews:
·Millenicom
·Cricket Broadband

Re: IPhone

The way I see it, theres a android coming out every month. Apple has one coming out every year. To me its just another android, big deal. For apple, holy shit new iphone, faster processor, better camera, heres my money, you dont see a iphone being released every month. Androids are mostly plastic, apple is glass and stainless steel, aluminum, etc.

tc1uscg

join:2005-03-09
Saint Clair Shores, MI

Re: IPhone

said by Duramax08:

The way I see it, theres a android coming out every month. Apple has one coming out every year. To me its just another android, big deal. For apple, holy shit new iphone, faster processor, better camera, heres my money, you dont see a iphone being released every month. Androids are mostly plastic, apple is glass and stainless steel, aluminum, etc.

And pricey and one IMPORTANT thing. They do break.

Rob
In Deo speramus.
Premium
join:2001-08-25
Kendall, FL
kudos:3
said by Thaler:

Because as we all know, companies are only in business for one quarter, tops.

When has an Android brought in 1.8 million subscribers in one quarter to a company that is dying?

'nuff said.
--
CheckSite.us | YourIP.us | Reverseip.us

Thaler
Premium
join:2004-02-02
Los Angeles, CA
kudos:3

Re: IPhone

They sure are, if that's the last unit they ever sell.

This is why contextless "facts" are useless and deceptive.

tc1uscg

join:2005-03-09
Saint Clair Shores, MI
said by Rob:

said by Thaler:

Because as we all know, companies are only in business for one quarter, tops.

When has an Android brought in 1.8 million subscribers in one quarter to a company that is dying?

'nuff said.

You don't get it Rob. Even at 1.8mil, it still wasn't enough to bypass the android phones. Who's dying? Sprint? I'll let you in on a little secret, no phone can save them. In fact, last I read, it's killing them. And, it's also costing their customers more money too. 'Nuff said.

Rob
In Deo speramus.
Premium
join:2001-08-25
Kendall, FL
kudos:3

Re: IPhone

said by tc1uscg:

said by Rob:

said by Thaler:

Because as we all know, companies are only in business for one quarter, tops.

When has an Android brought in 1.8 million subscribers in one quarter to a company that is dying?

'nuff said.

You don't get it Rob. Even at 1.8mil, it still wasn't enough to bypass the android phones. Who's dying? Sprint? I'll let you in on a little secret, no phone can save them. In fact, last I read, it's killing them. And, it's also costing their customers more money too. 'Nuff said.

No, you don't get it. There's a reason why Sprint is in the financial situation they are in. And yet, 1.8 million new subscribers felt that they were willing to give Sprint a chance all because of the phone. That's unprecedented.

It may be killing them, but they were dying anyways.
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markofmayhem
Why not now?
Premium
join:2004-04-08
Pittsburgh, PA
kudos:5
Reviews:
·Comcast
»www.wired.com/gadgetlab/2011/01/···e-debut/

10 million. 2 quarters, granted, data "per quarter" wasn't all that available outside of Apple products. Not an iphone.

»www.wired.com/gadgetlab/2010/08/···s-sales/

1 million. 45 days. Not an iphone.

And who can forget the "Sprint fires employee who leaked sales figures" fiasco around the HTC Evo 4G which broke "launch weekend" sales records??? Speaking of HTC, they are above Samsung who is above Apple:

»www.goodandevo.net/2011/11/htc-b···-us.html

Unfortunately, these companies do not required locked contracts with positive spin press surrounding every move, product, and dump in the bathroom resulting in less broken down statistics. But I guess we can just argue that the 3-4 million Galaxy and Evo 4G owners are 100% recurring Sprint customers, not a single one new, in order to loft up the iphone on a pedestal. After all, we could be adding it wrong.
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Show off that hardware: join Team Discovery and Team Helix
fiberguy
My views are my own.
Premium
join:2005-05-20
kudos:3
So you, like many, are comparing an OS to that of hardware with OS...?

If the argument was Android OS to iOS then there would be a discussion, however, we're talking about an OS to a Phone.

And, considering that Apple had one US carrier up against every other carrier with a phone maker willing to slap Android OS on it, well of course the Android OS will have more market share.

Non-scientific observation here, but I still hear more android people (in my circle) moving to Apple than the other way around. I don't think that's necessarily because of Android itself, rather, because of the various hardware makers who make crappy phones that are often under powered an unable to handle the OS, OR because android still doesn't work as smoothly as the iOS phone does.
xenophon

join:2007-09-17
Apple has the carriers squeezed by the kahunas. All of the carriers are paying too much to subsidize, hurting profits. The carriers should probably charge $300 for the base iPhone to cut some of the subsidized amount.

delusion ftl

@comcast.net

Re: IPhone

You're being generous, it should be closer to 400 dollars for a subsidized iphone.

canesfan2001

join:2003-02-04
Hialeah, FL

Small fortune?

In what world is $15.5 Billion a small fortune?

See 17 replies to this post

delusion ftl

@comcast.net

Bad Bad deal for Sprint

Almost 25% of sprints monthly plans for the iphone essentially ends up in Apples hand (via 2 year subsidy). How much margin do you think they have to remain profitable?

If the iphone contract plays out like it's written, Sprints banking on almost all of their subscribers to be on iphones in 4 years. Sprint is picking up almost twice the subsidy fee for Apple on nearly almost their subs?

This is either going to end in price hikes and/or bankruptcy.

I cannot fathom how this deal made it past Sprints board, they lost more money last quarter than any company can keep up for very long.

mix

join:2002-03-19
Utica, MI

Re: Bad Bad deal for Sprint

Might want to check your math on "Sprints banking on almost all of their subscribers to be on iphones in 4 years." Here is a hint, how often do iPhone users upgrade their phone in a 4 year time span?

delusion ftl

@comcast.net

Re: Bad Bad deal for Sprint

I did my math, how many of sprints subscribers are prepay, how many are feature phones and how many are direct connect.

Now cram 30 million iphones into the rest over 4 years and make money.

mix

join:2002-03-19
Utica, MI

Re: Bad Bad deal for Sprint

32.9 million postpaid subscribers and 13.6 prepaid

fuziwuzi
Not born yesterday
Premium
join:2005-07-01
Atlanta, GA
I know two people who got a Sprint iPhone as soon as they were available. Both of them say as soon as their contract is up they're dumping both the phone and Sprint. Constant dropped calls and phones that just don't live up to all the hype (neither had ever had a smart phone prior to getting the iPhone) have spoiled their experience.
--
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fiberguy
My views are my own.
Premium
join:2005-05-20
kudos:3
Your speculation is dead wrong. (on many levels)

The phone is going to be paid for in most cases by the consumer one way or another. They get $200 up front for the phone, and they get, what, $325 for an ETF? ($525? combined?) ... it moves on next to time in service for the customer. Sprint is not being a cookie cutter phone carrier like AT&T and Verizon are with each other. Sprint is selling their service a bit different than the others.. "unlimited data" ... remember? Sprint is starting to gain some momentum in the market place as well.

I could go on here, but really, I replied to your post because you, like so many "analysts" here say, is that "it will end in bankruptcy" or "it will spell disaster for..." ... so let me make up a number.. "99%" of you are usually wrong. By the way, people kept calling for the death of Vonage.. they're still in business and quite frankly still the only player out there that's got a retail presence unlike others who are either techie dreams, that is if they haven't died or folded already.

Business is sometimes not always about numbers.. companies can "lose" money and still survive.. in this case Sprint is making an educated move apparently on information you're not privileged to.

I swear, if some companies took the advice of many of the users in these forums they actually WOULD go out of business. Sometimes what make sense to you (and may very well be a good idea) doesn't work in the market.

mix

join:2002-03-19
Utica, MI

iPhone 5

Hey, whats the point of a new LTE network if you can't run the biggest consumer phone on it? Expect uptake of Apple devices on Sprint's network to grow by leaps and bounds later this year-beginning once all these markets that were skipped by Clearwire get LTE networks up and running starting this summer.

mix

join:2002-03-19
Utica, MI

Re: iPhone 5

Let's assume that an average future iPhone is going to cost $700 over the next 4 years.

$15.5 billion / $700 = 22.1 million iPhones to sell in 4 years

22.1 / 4 = 5.5 million per year

Sprint averaged in 2011 32.9 million postpaid subscribers and 13.6 prepaid subscribers. Sprint activated 1.8 million iPhones in Q4 2011, of which 40% (720 thousand) were new customers.

The question is, how many of Sprint's postpaid customers will switch to the iPhone when their current contract is up? How many Nextel postpaid customers will switch to an iPhone as the Nextel Network is being phased out? How many new customers will sign up with Sprint and activate an iPhone in the next 4 years? How many times in 4 years will a Sprint iPhone user upgrade to the next gen iPhone? Will Sprint consider offering the iPhone (or a next generation low cost/performance iPhone, or even a last generation iPhone) to it's prepaid customers? Is the iPad considered part of this contract?

IllIlIlllIll
EliteData
Premium
join:2003-07-06
Hampton Bays, NY
kudos:7

Yup

the costs will be recouped with increased costs for subscription plans for new and existing customers - guaranteed
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King P
Don't blame me. I voted for Ron Paul
Premium
join:2004-11-17
Franklin, TN

Re: Yup

I fully expect Sprint to maintain "Unlimited*" data, at a high premium, with a tiered data plan beneath, similar to Verizon/AT&T.
--
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»www.zunetracks.net
MTB

join:2007-06-29
Newport Beach, CA

Re: Yup

Sprint users will be paying for iphones. Sounds the tech form of the bailout blueprint

dvd536
as Mr. Pink as they come
Premium
join:2001-04-27
Phoenix, AZ
kudos:4
said by IllIlIlllIll:

the costs will be recouped with increased costs for subscription plans for new and existing customers - guaranteed

Look for new "because we can" fees too!

King P
Don't blame me. I voted for Ron Paul
Premium
join:2004-11-17
Franklin, TN
Reviews:
·Comcast
·Vonage

things are not going so well for old Dan...

I'm glad to see that Sprint has turned around their customer service rating, however I'm beginning to see a pattern of failure here, with Sprint's recent decisions.

1. WiMAX: Ok, this may have been a use it/lose it scenario...so they had to do something with it...still not the best choice.
2. Lightsquared: Sprint may not have lost money, but they've lost time and are now at the mercy of Clearwire or maybe another partner to rollout the LTE portion of their much hailed "Network Vision" upgrade.
3. iPhone: 15.5 billion over 4 years. That is still a chunk of money. Especially for a company that has significantly less revenue than Verizon or AT&T, while also trying to prop up Clearwire, and rollout a nationwide network upgrade.
4. MetroPCS: Technologically speaking, it makes sense...but the board vetoed it. Smart move. I'm not really sure what this would have gained Sprint, since Metro is mostly available in areas where Sprint already has a significant presence. Metro's LTE footprint is relatively small still, and Sprint already has to Pre-Paid MVNO's that they own.
--
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»www.zunetracks.net

SteelerRaw

@timet.com

Re: things are not going so well for old Dan...

said by King P:

1. WiMAX: Ok, this may have been a use it/lose it scenario...so they had to do something with it...still not the best choice.

No "may have been" to it, that was the scenario. They had FCC deadlines to meet and LTE simply wasn't ready. Was WiMAX the best choice? That's debatable since it was essentially their only choice at the time.

2. Lightsquared: Sprint may not have lost money, but they've lost time and are now at the mercy of Clearwire or maybe another partner to rollout the LTE portion of their much hailed "Network Vision" upgrade.

Please explain explain exactly how they've lost time. And they aren't dependent upon Clearwire for LTE. They're rolling out LTE on their own 1900MHz spectrum and eventually on their 800MHz spectrum. Clearwire's TD-LTE deployment will be in addition to that.

3. iPhone: 15.5 billion over 4 years. That is still a chunk of money. Especially for a company that has significantly less revenue than Verizon or AT&T, while also trying to prop up Clearwire, and rollout a nationwide network upgrade.

No doubt, but what's the alternative? Not carry and continue to watch customers flee a la T-Mobile and USCC?

4. MetroPCS: Technologically speaking, it makes sense...but the board vetoed it. Smart move. I'm not really sure what this would have gained Sprint, since Metro is mostly available in areas where Sprint already has a significant presence. Metro's LTE footprint is relatively small still, and Sprint already has to Pre-Paid MVNO's that they own.

Spectrum, customers and eliminating a competitor to their Boost and Virgin Mobile brands.
tcope
Premium
join:2003-05-07
Sandy, UT
kudos:2

TMo

I don't think people are considering Sprints competition. That is, ignoring it and thinking TM will be doing nothing. DT is getting behind TM with it's continued roll out of +42 network as well as LTE in the future. I suspect that TM will be doing everything they can to improve customer service and still keeping their nitch of offering inexpensive phones/plans.

Will people stick with the iPhone if it means increased prices and more limited data? Given the mentality of most iPhone users (no offense), it's possible.

n2jtx

join:2001-01-13
Glen Head, NY

Unlocking the iPhone on Sprint

It is this long term commitment that has me hoping Sprint will see the light and fully unlock iPhone's at the completion of a contract. It is in Sprint's best interest to push older iPhone model's off their network and encourage people to replace them with newer models. I would be a bit reluctant to switch from my 4S in October 2013 if I cannot sell it as a fully unlocked phone. I could probably just sell it to someone who wants to go with Sprint BUT that denies Sprint an iPhone sale. Whatever Sprint can do to encourage churn in iPhone's would be in their best interest in meeting the goal of selling 30.5 million iPhones.
--
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iamwhatiam

@verizon.net

Lucky me.

I'm still with T-Mobile (because I--rationally--decided to wait until the at&t takeover actually occurred ...though it's still wait&see if T-Mobile survives). I don't know who's dumber--Sprint for paying out too much to get a "deal" from Apple or the goobs who use crApple devices.
tmc8080

join:2004-04-24
Brooklyn, NY
Reviews:
·ooma
·Optimum Online
·Verizon FiOS

money upfront..

Did you know that part of this deal was a MINIMUM GUARANTEED subsidy deal that benefits Apple and $$ COSTS $$ Sprint money if they don't sell service and handsets!!!

This is to your advantage as a potential subscriber if you hold off until Sprint is more DESPERATE to actually move product and service alike! That could mean LOWER RATES, MORE COMPREHENSIVE INVESTMENT IN DEPLOYMENTS OF TOWERS, ETC!!

So, just boycott Sprint for about 6-12 months and see if the deals from Sprint sweeten or they end up taking a yearly bath and get taken out back and shot by their investors!!
fiberguy
My views are my own.
Premium
join:2005-05-20
kudos:3

Re: money upfront..

Yea.. that's a GREAT idea.. starve the company of profits to the point where they can't afford to maintain their network effectively, or provide good customer service - that way the happy customers will get worse service and in turn leave and go to another provider which would ultimately ruin any gains they had on their reputation and cause more public opinion backlash which would send any company in a competitive environment into the tubes..

... that is THE best answer anyone has come up with all day! .. because everyone wants to "invest" in a company that is hurting and absolutely positions a company to deploy bigger and better service.

And ALL so you can save a buck or two on a piece of hardware that may or may not happen.

It won't ever happen because while you and others would "boycot" sprint, others would see your idea as idiotic or simply not care. You can't get enough support to make this idea work.. plain and simple it's a total crap idea and stupid thinking.
acrowl

join:2001-08-08
California, KY

Debate all you want....

I own an independent Sprint dealership. I have close to 60 phones on display. Hands down, the iPhone is why people are walking in to my store. And most of the time, that is the handset they buy.

This iconic handset is what people want. Will the allure of the iPhone last for the full term of the agreement? Only time will tell.

All you have to do is look at T-Mobile. Not having it would have been disastrous.

mix

join:2002-03-19
Utica, MI

Re: Debate all you want....

Would you be willing to share with us what percentage of your total activations in say a month are iPhones vs everything total?

SucksToBeYou

@bell.ca

Re: Debate all you want....

Lets break it down even further, right now you are comparing basically one iphone against how many android phones across how many manufactures? There has to be at least 30 distinctively different models (different screen sizes, shapes and styles, etc) of android phones competing against really one model of the iphone. You can't dispute that, even if apple had 0.001% market share this still holds true.

I know there is a lot of google/apple love out there and I try to avoid these types of discussions as people are so passionate over a phone which they planning on throwing out in 2 years time.
jfmezei
Premium
join:2007-01-03
Pointe-Claire, QC
kudos:22

Sprint Management saw this youtube

Sprint Management saw this video and realised that they had to carry the iphone at *any* cost.

»www.youtube.com/watch?v=FL7yD-0pqZg


After all, what other phone has the bigger geebees and the wifies ?

A contract that forces Sprint to spend at least $15 billion without specifying the actual phone prices may not be so bad. If individual handset model prices can be negotiated and renegotiated as new models emerge, then Sprint may not be in any worse situation than Verizon or AT&T with regards to how much they have to pay for each iPhone.

In fact, I wouldn't be surprised in Verizon and AT&T have similar deals. The difference is that the 15 billion liability may be higher for Sprint relative to the size of its business.

The key metric will be a comparison of how quickly the subsidy will be paid back for Sprint relative to the expected duration of the contract. If iPhones last on average 2 years and customers expect a subsidized replacement every 2 years, then Sprint better make sure that the subsidy is paid back before that time comes otherwise it will never make money on iphones.

I'd like to see a comparison of Verizon, AT&T and Sprint's subsidy payback timeframes before passing judgement on whether Sprint is really worse off. It could simply be a question of the iPhone being a much bigger piece of the pie for Sprint than it is for Verizon/AT&T and thus looks worse.

One thing is sure: Apple has managed to extract a lot of money from mobile carriers. And lets face it, those carriers who don't have the iPhone are hurting because of that.

bobjohnson
Premium
join:2007-02-03
Orlando, FL
Reviews:
·T-Mobile US
·Sprint Mobile Br..

Re: Sprint Management saw this youtube

You make a few very good points in your post. I want to rant about the iphone though. I believe that all this money that was spent on the iphone has caused Sprint to start some of the negative things that they are doing to the rest of us, such as finding ways to lower our business discounts, add extra charges to our bills, and otherwise start acting like the others as far as nickel and diming everyone that i believe they would not have otherwise done. That to me is not acceptable.
--

fiberguy
My views are my own.
Premium
join:2005-05-20
kudos:3

Re: Sprint Management saw this youtube

It has ABSOLUTELY NOTHING to do with why the business discounts were lowered, extra charges, etc. That all had to do with the fact that discounters don't always win.. they don't always provide better service.. What Sprint did was positioned their revenue to where it needed to really be in order to actually make something off those monthly invoices they send out. What YOU see, as a consumer, as nickel and diming, always isn't that, but that's how you're going to see it. Prices have to go up.. for a long while Sprint was doing everything it could to compete on price alone and they learned that they weren't making enough on volume vs quality and it showed in poor service and cuts to where customers really see it. (Poor reception, horrible outsourced customer service, etc)

.. in case you haven't noticed, Sprint's service is improving all around. That nickel and diming, as you call it, has helped them rebuild.

Care to guess what Sprint's BIGGEST mistake ever was?? ... turning down the iPhone the first time it was offered to them. I think had not been THE carrier and Sprint took it, they'd be LEAPS ahead today for it.

Ever remember a phone company called "US WEST"...? ... remember when they put all their eggs in to DSL because "wireless won't ever take off..."....? Yea, that was their biggest mistake too.
rradina

join:2000-08-08
Chesterfield, MO

Scary Thought...

It's no wonder AT&T wants to rape content providers to use its network. Did AT&T get this idea from handset manufacturers? Are they just paying it forward?
BiggA

join:2005-11-23
EARTH
Reviews:
·Comcast

What a mess

That's 24M iPhones, which is almost as many customers as they have. It's insane. Unfortunately they didn't have the luxury of being a GSM carrier where they could just let people SIM-swap into unlocked ones.

However, this was a terrible decision on their part. They are going to have a hard time moving them, and it is going to force them to not price-differentiate themselves, which is exactly what they need to do in a market where Verizon and AT&T are king.

See 6 replies to this post

old_dawg
"I Know Noting..."

join:2001-09-22
Westminster, MD

?

Sprint and profit used in the same sentence? A-ha-ha.
--
"Our network engineers are aware of the problem..."

SysOp

join:2001-04-18
Douglasville, GA

iphone 4G

Glad I got my iPhone 4 from Sprint. If I am going to spend all my money I has to have a true 4G network to use my iPhone 4G on.

What? The iPhone 4 is 3G? Glad Sprint has a true 3G network.

What? Sprint oversold their network?

PaCK Fan

join:2012-01-19
Richmond, VA

this and Nascar?

Sprint is taking a major beating with both this and Nascar sponsorship.....wow

SteelerRaw

@timet.com

Re: this and Nascar?

said by PaCK Fan:

Sprint is taking a major beating with both this and Nascar sponsorship.....wow

How much did the extension of the NASCAR sponsorship cost Sprint?

Alcohol
Premium
join:2003-05-26
Climax, MI
kudos:3

Re: this and Nascar?

They also sponsor NBA now. T-mobile didn't renew because they thought they were going to be bought by AT&T.
--
I found the key to success but somebody changed the lock.

PaCK Fan

join:2012-01-19
Richmond, VA
It looks like a rough average of $75 million a year, they just signed up to do a 3 year extension.

»sprinttutorials.net/2011/12/03/s···sponsor/

AVD
Respice, Adspice, Prospice
Premium
join:2003-02-06
Onion, NJ
kudos:1

contrary to initial reports

this means they are selling more than the minimum expected (or at least contracted for).

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