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Sprint loses 1.3M net subs, base drops to 50.5M
Sprint Nextel, in the midst of struggling to stabilize its customer base and improve its financial position, posted a net loss of $326 million in the third quarter, compared to a net income of $64 million in the third quarter last year, and said it had a net loss of 1.3 million subscribers in the quarter. Sprint CEO Dan Hesse reiterated that the company had been focused on retention of customers, improving the customer experience and paying down its debt more than it focused on acquisition of new customers. Wireless services revenue for the quarter was $6.8 billion, down 13 percent year-on-year.
Subscribers: The carrier saw a loss of 1.3 million net subscribers in the quarter, including a loss of 1.1 million postpaid subscribers and 329,000 prepaid users. By comparison, Sprint's two largest rivals saw large boosts in their net additions this quarter; AT&T Mobility added around 2 million subscribers and Verizon Wireless added 1.5 million. The carrier's base dropped to 50.5 million subscribers, which is the lowest the company has reported since first quarter 2006.
Churn: The company's post-paid churn was 2.15 percent, compared to 2.0 percent in the second quarter of 2008 and 2.3 percent in the third quarter of 2007. According to Technology Business Research analyst Kate Price, this increase in postpaid churn is due to seasonality and it is half that of historic third quarters, which indicates improvement.
ARPU: Wireless post-paid ARPU was flat at $56, compared to the first and second quarters of 2008, and down from $60 in the third quarter of 2007. For the quarter, data revenues made up about $13.50 of the total post-paid ARPU. That was mostly because of growth in CDMA data ARPU.
Company outlook: Hesse emphasized that the company paid down more than $1 billion in outstanding debt and was looking to stabilize itself with its customer base before expanding gross additions. He pointed to the launch of the One Click user interface on Sprint handsets, its Ready Now retail experience and Simply Everything voice and data plans as signs that the company was improving its customer experience. In addition, he noted that the company had closed customer service call centers as call quality improved. However, he acknowledged that the carrier would have to improve churn levels and reduce the decline in gross additions before it moved ahead in 2009 with increasing gross adds. "Turning this trend around in a recurring revenue business happens gradually," he said.
For more:
- see this release
Related Articles:
Sprint customers continue to flee, base drops to 51.9M
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Comments (8) | Post a comment
Comments
Posted by Anonymous | November 7, 2008 - 1:18pm
It’s apparent to anyone who has worked in Telecom, used Sprint’s service and lives in Kansas City, that Sprint does not have (nor can they attract) the talent to operate and maintain their two incompatible wireless networks. To top that off, after two years of mucking around trying to deploy a third network (Xohm), all Sprint has to show for their efforts, is a scaled down, test market in Baltimore (Anyone remember in the 90s when it took most new wireless carriers (with a minimal, highly trained and experienced team), only two years to provide coverage and launch every MSA in the U.S.?).
The untold story is that subscribers are not the only people leaving Sprint in mass, talented employees have been bolting from Sprint for almost three years as well. Of course most, if not all, of the “mess makers, non-performers and office politicians” are still entrenched in their corner offices and the executive building, hence the 2008 third quarter results.
Until Sprint re-brands itself, makes significant changes to their board of directors, changes existing, entrenched management (at all levels), re-locates all operations to a city where there is new and fresh managerial and technical talent, changes their culture and the way they do business, we can expect more quarterly results from Sprint exactly like we have seen in the past six, dismal.
Still, you’d be hard pressed to find anyone in the Kansas City metro who believes Sprint can be salvaged. Sprint is, as one person commented in the local Kansas City newspaper, too far gone.
Posted by Churn Noble | November 7, 2008 - 2:38pm
Sprint churn is in runaway meltdown. Would somebody please get some cement and pour it on the iDEN network, before it’s too late? Churn Noble
Posted by Sci-Fi Movie Critic | November 7, 2008 - 2:51pm
Is Sprint’s churn the sequel to the classic sci-fi movie, “The Invasion of the Body Snatchers,” or the “Incredible Shrinking Man”? Or, does Motorola Devices actually have rights to the “Incredible Shrinking Man”? The horror of it all.
Posted by Anonymous | November 7, 2008 - 7:55pm
How can this be?
Per the Sprint spin machine...
The instinc is flying off the shelves
The network is performing at best ever levels
We won an award for our improved customer service
1.3 million ex-Sprint customers (3rd quarter) have spoken and well, obviously disagreed.
Posted by Anonymous | November 7, 2008 - 8:33pm
The only reason they're keeping iden is because no one really wanted to buy it, at least no one who can get the capital together in the current economic market.
Most of the churn is from iden customers. Two way radio is old and outdated. Customer service sucked at Nextel too, as far back as 1996, so don't blame Sprint's customer service for ruining iden. Nextel's iden and TDMA cellular network will never be able to keep up with the current data driven market when it comes to speed. I've sold both products B2B in my career, and iden/TDMA is slow and limited. I can't imagine selling something today that I sold ten years ago when it comes to digital cellular technology.
Dump iden, and like the first commenter said, dump most of the middle and upper management. They move around to different jobs and departments to make sure each other gets some experience in all departments and can be saved when layoffs come around. Yet the real talent, the field level and district employees are left sitting and rotting. So they quit.
Dump iden, get rid of mid level area sales directors and VPS. Then get back to loving your field employees and listening to them when they try to tell management what the customers are mad about. And for god's sake dump the ridiculous paperwork and performance review bureaucracy. It's not as though I've had a manager really read my review in over ten years anyway. And get rid of the part time employees in the company stores. Give your managers some training in interviewing skills. They're hiring degenerates that can get a job anywhere else and don't care about customers or Sprint at all. And they turn-over in 6-9 months because they don't see any opportunity for career development or decent pay.
Posted by Anonymous | November 8, 2008 - 8:52am
Hey...I heard Sprint is lowering the thermostat at its offices to cut heating expenses. What are the C level executives doing about cutting their bloated salaries and packages to help? What do you think the spinmeister will say to that?
Posted by Anonymous | November 8, 2008 - 9:06am
The iDEN technology is certainly ancient technology from the dark ages. It was orginally designed for public safey in the late 1980s...APCO-25. Its was the digital transition from analog trunked networks. iDEN was decent technology at the time for the application, but its TDMA is way outdated by CDMA, EVDO, HSPA, HSPDA, and eventually LTE. Sprint should migrate it subs to CDMA and shut down iDEN. And get out of another obscure technology too - WiMax 802.16e - before it drains Sprint.
Posted by WilliamC | November 14, 2008 - 8:57pm
So, You are saying that At&t and Verizon's push-to-talk is any better? I haven't heard one person or customer of theirs say that their service is better. Let me see....fifteen years is old and antiquated by who's standards? Bloggers? or people who are trying to hurt Sprint so that At&t and Verizon can get more of their customers? Can you Push-to-talk in under a second with those other behomoths? Probably not!!! Nextel is the leader in push-to-talk. We also hear claims that their internet is slow. Evdo-Rev A is slow? 1XRRT is slow? I didn't know that was slow. If that is the case then Verizon uses Evdo - Rev A too. I guess their internet is slow too. I guess it's who you believe or the time of day or the season. Sprint hold on and when Wimax rolls out. Hey, two can play that game....Remember, Wimax will let you have to services for the price of one. I can't wait till it comes to New York/ Hudson Valley. P.S. they don't require you to have land line service to get it. So long behemoths. I will get rid of my landline service as soon as the service announces...I will save some cash, instead of giving it to them...Tsk,Tsk!!!
