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iDEN Shutdown May Effect Sprint and Its Decisions on Growth

September 12, 2013 | About:
Muhammad Bazil

Muhammad Bazil

3 followers
Sprint (S) has shown an increase in its shares by approximately 20% since the second quarter earnings that came out last month. This is very interesting to many people as the company has shut down its iDEN network. They did, however, add more than 190,000 customers that were already paid because of the U.S. Cellular deal. This is really a good thing as the company would have seen a loss without these customers.

It seems as though Sprint has been able to avoid any devastation over the last few quarters, but it is not believed that this is going to last. It is believed that Sprint will have a difficult time attracting new customers because it no longer has the iDEN network. It is also known that its LTE coverage is not as strong as other providers, and this could be a problem as well.

This company has started to work on increasing its customers in a number of ways. It is as if it knows that it could take a hit, and it is trying very hard to avoid it. It is trying to push the unlimited plans that it has. Some of its plans are now even coming with an unlimited guarantee that will be good for a lifetime. As if that is not enough, it is interesting to know that it is also trying to increase its LTG coverage. The capital expenditures that it has put into place has caused an increase of roughly 70% in spending.

Some professionals are concerned that Sprint should be looking at more shared data plans rather than unlimited plans. These individuals believe that the shared plans are going to help the company control the data that it is offering and the cost. The users also know that there are benefits to this type of plan, and they are able to manage all of their devices and plans on one account. Customers are pleased about this, and Sprint should be thinking about that as it is a huge opportunity that it is not going to want to miss out on.

The margin for this company is lower than the margin that is seen by its competitors. That means that it certainly has room to grow in this area. The Nextel platform that shut down did give the company the opportunity to save approximately $1.4 billion each year because it is not paying for rent, utilities and other expenses. All of this saved money could easily be used to increase the wireless margins that it currently has, as they only run on 40 MHz.

Along with the above possibilities it is interesting to know that they have launched their 4G LTE network services in more than 150 cities and this is expected to continue to grow. They also have their sights set on increasing the coverage that they are currently offering by more than 2 million miles. This is a huge area when you think about the number of customers that they can gain with this expansion. The speed is to be enhanced to the 2.5 GHz spectrum as well. There are businesses that are going to love this because it will certainly help to ensure that they are going to have the high speed internet access that they need.

Most individuals are going to tell you that that they love to have new merchandise that they can purchase and play around with. Sprint realizes this and they are planning on adding at least two new smart phones to their lineup. This will include the Q10 Blackberry and Samsung’s Mega Galaxy. These new smart phones may really help boost the number of new customers that they have.

Business owners have certain needs of their own. They need to know that their data is always going to be safe and secure. Privacy is also an issue all of the time for business owners. It will be very important to know that things will not be accessed by people that should not have it. Sprint is aware of this and they started the Ethernet Wave Service. This high speed internet is going to meet the business owners need for speed, privacy and even security.

In the end, the public should know that Sprint is facing some very fierce competition when it comes to Verizon (VZ) and AT&T (T). Both of these companies have very deep pockets and they have really large customer bases. It may even be a good idea to pay attention to T-Mobile, as it is making its move and could become a threat to Sprint in the near future. This is especially true when you consider wirelines. It seems apparent that Sprint needs to consider the options that it has and make some serious decisions if they want to remain in the game. They have potential for growth but they have to make some very smart moves.

About the author:

Muhammad Bazil
Muhammad Bazil is a financial journalist and editor for a variety of websites, public policy organizations, and book publishers. He has written hundreds of published articles and blog posts on topics including budgeting, credit management, real estate and investing. His articles have been featured on the homepage of Yahoo!, MSN and numerous local news websites.

Rating: 3.8/5 (4 votes)

Comments

hasanova
Hasanova - 10 months ago


"Affect"

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