Sprint drops subscribers but no layoffs in the mix

Ah Sprint. How I love thee? I wake up to news this morning that Sprint had lost 148,000 net subscribers in the fourth quarter, from 1.27 million a year earlier. The decline in highly valuable contract customers, who generate average monthly revenue of $55, fell by more than half, to 504,000.  Revenues slipped to $32.3 billion last year, though Sprint held the drop to less than 10 percent. But yet in the same breath I read that Sprint is also looking to expand it’s prepaid business. Hit the link for more. Sprint’s CFO Bob Brust said: “As far as we can see, that takes care of that part of our cost reduction program.”

Many people do not know that Sprint is the owner of Nextel. Many more do not know that Boost Mobile is a division of Sprint, which was started on Nextel unused portion of the iDEN network. Boost has been the principal driver of its prepaid growth over the past year to customers that seek competitive unlimited plans, going head to head with Metro PCS and Leap Mobile. But Virgin Mobile USA, which was acquired by Sprint last December, is the main arm of Sprint’s prepaid business that offers data services. Also, last month, Sprint decided to launch Assurance Wireless, another carrier which targets low-income households (that receive government assistance).

The problem Sprint has now, trying to juggle all of these brands, is dilution of the the Sprint and Nextel names. This is going to lead to confusion over the long haul and can be a tough road for Sprint. But ye, I have faith. I have been a loyalist for quite some time and having Mr. Hesse personally respond to an email I sent to him, where I was complaining about my lack of quality phones over a year ago, led me into the phone-tech blogging world and has transformed me from an upset customer, to a believer in the direction Sprint is headed, with something to say about cell phone and mobile technology.

Sprint needs to K.I.S.S (Keep It Simple Stupid). Focus on your core brand: Sprint. Make customer satisfaction your number one priority. Get that 4G network fully deployed and get the 4G phones that can ride that speedy network and actually utilize it in every manner and you have a winning combination of success. Advertise, advertise and advertise. Market the company for all of it’s positive strengths: reliable network, fast, secure, new phones, customer service – you actually care and not just say you care about your customers, how strong you are and the direction of the company. Make the ads funny because that is what people remember in the long run.

Mid-last year the ARPU went from $30 to $34, and churn has fallen from 7.35 percent to 6.38 on Boost, so that showed profits and customer retention can be made.  Oh and also: buy MetroPCS. Metro will give Sprint, complete and utter domination of the prepaid markets, which has proven to be very profitable part of the Sprint’s bottom line. Then watch Tracfone and Net10 come running to a carrier looking for a buyout. Then who is left in this market? Leap and a few other small regional carriers, T-Mobile, Verizon and AT&T prepaid arms?  Sprint could put some serious hurt on the prepaid industry with a smart acquisition like MetroPCS. Control the pricing in various markets, through having multiple channels, which would give Sprint more variability in pricing across their brand names it the prepaid markets.

Analyst may say one thing, but they don’t actually know what it takes to run wireless business, you do Sprint. Keep plugging away and go out there and get some more subscribers with aggressive ads to showcase how reliable the Sprint network really is in the end.