Sprint (NYSE: S) has been talking about the unique benefits of its 2.5 GHz spectrum for years--first when its partner Clearwire owned it, and then after Sprint bought Clearwire. They're still talking about how it's a differentiator.
Sprint CEO Marcelo Claure said in May that within 18 to 24 months, Sprint will have the best network in the industry. "We are the operator with the largest spectrum holdings in the world," Claure said last month at Re/code's Code Conference. "Nobody has 150 MHz of combined spectrum today." Sprint controls around 120 MHz of 2.5 GHz in 90 of the top 100 U.S. markets.
Yet unless and until Sprint fully takes advantage of that spectrum, especially by deploying two-carrier and then three-carrier carrier aggregation--and getting millions more smartphones and tablets into customers' hands that can take advantage of that technology--I don't see Sprint making meaningful market share gains or standing out from its competitors.
At this point, I'm just a little bit skeptical of Sprint's claims. Sprint keeps saying it will have a superior network, and then keeps pushing out the timeline for when that superior network will be up and running. Here are some quotes and reports from the past few years that may help explain my skepticism:
- Recall that Sprint's 2.5 GHz network is using the same spectrum that its Xohm WiMAX brand was using in 2008 (Xohm was combined with Clearwire in the fall of 2008). Although WiMAX was not a failure as a technology, and was in the market years before LTE, Sprint was similarly optimistic about its chances in the fall of 2008, and said the network would reach 140 million POPs by 2010 (in fact, it reached 117 million by the end of 2010 and topped out at 135 million). Sprint chose WiMAX as a 4G standard because it is "available now and our customers want 4G now," said former Sprint CEO Dan Hesse, in October 2008.
- "With our 2.5 GHz band already standardized for carrier aggregation, we are in a position to leverage the next release of LTE advance technology to create even better pipes and potentially offer the fastest speeds with the deepest capacity network in the nation."--former Clearwire CEO Erik Prusch, in February 2013
- "So the peak speeds that we can offer now, basically 50 to 60 megabits per second, in two years will be more like 150 to 180 megabits per second because we have 120 MHz of spectrum on Clearwire and what we are able to do is rather than have a whole bunch of 20s, slap them basically into two big mass of 60s that can go really, really fast and that's leading-edge technology."--former Sprint CEO Dan Hesse, in December 2013
- "Clearly we've come a long way from where we were. This year we will be able to say we are back in the game."--Sprint CTO Stephen Bye, in January 2014
- "John Saw, Sprint's chief network officer, said that the carrier plans to expand its tri-band LTE Spark service to a two-carrier configuration toward the end of this year, which he said will result in peak download speeds of 120 Mbps. Then, by the end of 2015, Sprint plans to add another carrier to the configuration of its 2.5 GHz LTE network, which will result in three-carrier peak speeds of 180 Mbps."--FierceWireless article, March 2014
- "We're in the process of enabling 2x20 TDD carrier aggregation within the 2.5 GHz band which will further improve the speed and capacity of the network."--Sprint CEO Marcelo Claure, May 2015
The truly "blazing fast" speeds that Clearwire started talking up in May 2012, when it was touting 168 Mbps theoretical peak downlink speeds, haven't arrived yet. Will they ever? Will it even matter when they do?
There are several reasons it has taken so long. Sprint's fight with Dish Network (NASDAQ: DISH) prolonged the time it took to get control of the spectrum and deploy it. Sprint announced it would use 8T8R radio heads in October 2013 to expand 2.5 GHz coverage, but only started really deploying those heavily in the middle of 2014.
Network testing firm RootMetrics, which Sprint loves to point to for validation, said in February that in the second half of 2014, despite the strides Sprint made on improving voice and texting performance, Sprint still had the slowest network and weakest data performance of the four Tier 1 U.S. carriers. Sprint did point out today though that in 111 of 125 markets to be measured in the first half of 2015, RootMetrics awarded it a total of 156 first place (outright or shared) RootScore Awards for overall, reliability, speed, data, call, or text network performance, compared with just 21 award wins in these same 111 markets in the first half of 2014.
Sprint did manage to hit 100 million POPs covered with 2.5 GHz TD-LTE by the end of 2014 and at last count had covered 125 million POPs with the spectrum. How much has Sprint done beyond that, and how much does it plan to cover by the end of 2015? Sprint won't say. Where has Sprint deployed carrier aggregation in the 2.5 GHz band? Sprint also won't say.
Bye told me in May that "I can assure you that Sprint has not slow rolled" on carrier aggregation, but that Sprint has not made much public noise about it because it wants to get more phones that can do 2x and 3x carrier aggregation into customers' hands so they can experience the speed advantages before doing so.
When are we going to see the results of carrier aggregation in the 2.5 GHz band? What are the improvements that are being made in speeds and capacity? I'm not a network tester, so I'll wait for more third-party results.
I hope Sprint's network does live up to the hype, for several reasons. First, it would likely help out Sprint, boost its subscriber numbers and make it into a more meaningful competitor. Second, it would force Verizon Wireless (NYSE: VZ), AT&T Mobility (NYSE: T) and T-Mobile US (NYSE:TMUS) to up their game in speed and capacity even more than they already would be doing. And third, it could provide a potential alternative to wired broadband (if the hype about carrier aggregation is to be believed).
Until Sprint can show why its network is so much better and how it will continue to improve, I'm going to remain skeptical. See you in December 2016. Or May 2017.--Phil