More than 200 million people covered by Sprint’s network can now access services on the carrier’s 2.5 GHz spectrum, CFO Tarek Robbiati said Wednesday. And the carrier is betting heavily its portfolio of those high-frequency airwaves gives it a significant edge as it tries to continue to gain market share against its competitors.
“A number of things have gone into our thinking of how we can reduce churn,” Robbiati said during an investor conference Wednesday. “The first is the network. We’ve improved our network quite dramatically with the rollout of 2.5 spectrum. Right now we have rolled it out to the extent it covers 70 percent of the 300 million POPs that we cover. We still have further upside from improving the experience and the performance of the network either by way of coverage or by way of actual speed.”
The deployment of 2.5 GHz spectrum enables Sprint to deliver carrier aggregation, a feature of LTE-Advanced that enables operators to combine bands of spectrum to create wider channels, producing increased capacity and higher speeds on supporting devices. Sprint has said its current two-channel carrier aggregation enables it to deliver peak speeds of more than 100 Mbps, and it has begun to deploy three-channel carrier aggregation, reaching speeds of 230 Mbps.
The improved network performance could help the nation’s fourth-largest mobile network operator reduce churn. Sprint posted a company-record postpaid churn of 1.39 percent in the second quarter, marking the sixth consecutive quarter of improved churn year over year.
Sprint must maintain that improved churn if it hopes to continue to grow its customer base and regain its footing against its three larger competitors. The carrier has gained traction largely due to the 50 percent-off promotions it first introduced late in 2014, and those customers’ contracts will begin to expire soon. Network performance is key to enticing them to stay with the operator, Robbiati said.
“There is a very strong correlation between our network performance and churn,” he said, according to a transcript from Seeking Alpha. “There is no doubt people churn first and foremost because of the network. Fifty percent of the reasons why customers churn are network related, 30 to 35 percent are price-related and 15 to 20 percent are service-related… And as we roll out more capabilities in the network – 2.5 spectrum carrier aggregation, beamforming, and when we densify our network – all of that is conducive to improving the customer experience and making sure that customers stay with us.”
- see this Seeking Alpha transcript
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