More than half of Sprint’s LTE traffic is being carried on its 2.5 GHz airwaves, CFO Tarek Robbiati said this morning. And that spectrum will be the “bedrock” for the carrier’s 5G efforts.
Robbiati told attendees at an investor conference this morning that the carrier holds 160 MHz of 2.5 GHz airwaves in markets across the country, and only one-fourth of that spectrum is currently being used. So Sprint, which is the only major U.S. operator not participating in the ongoing auction of 600 MHz airwaves, has ample spectrum to handle increasing data traffic as the industry enters the 5G era, he suggested.
“It (2.5 GHz) used to be perceived as being the nice-to-have WiMAX spectrum…. But it’s not nice-to-have. It’s essential spectrum,” Robbiati said. “That spectrum is unusually effective at carrying vast amounts of traffic, but it does not travel very far.”
Sprint is already putting some of its 2.5 GHz holdings to work to provide faster LTE service. The carrier is offering two-channel carrier aggregation in its 2.5 GHz spectrum in 250 markets, and has launched three-channel carrier aggregation in nine markets including Chicago, Dallas, Kansas City and San Francisco.
Because of the limited propagation characteristics of 2.5 GHz, though, operators will need plenty of the high-band airwaves to deliver data to users on the move, Robbiati said. Providing consistent 5G services to consumers “has to be handed over spectrum layers,” he said, so service isn’t interrupted.
“So now if you look at the world of 5G, we feel that 2.5 will be to 5G what 800 MHz was to LTE,” Robbiati said. “We feel that’s the bedrock of 5G.”
The executive also said Sprint is reconsidering how to go after the prepaid market after losing 427,000 prepaid users during the most recent quarter. Sprint is preparing to relaunch its Virgin Mobile brand in the coming months after pushing that effort back to 2017, and its Boost Mobile brand recently reinstated a promotion that offers free phones to users who switch from other service providers.
The challenge, Robbiati said, is to target more lucrative prepaid users without investing much in low-end users who generate smaller ARPU.
“With regards to prepaid there’s a lot of work that needs to be done there as well,” Robbiati said. “Prepaid is a business that you can really misjudge if you look at it just from a subscriber standpoint…. It’s getting tough, for sure, but you have to be diligent in how you go after that space.”
*This article was updated Nov. 9 to clarify Sprint's progress in deploying two- and three-carrier aggregation.