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Marcelo declares A New Day For Sprint and changes Band 41 priorities

Posted by Mr.Nuke , in Author: Seth Goodwin 11 September 2014 · 27,830 views

Sprint Marcelo Marcelo Claure Band 41 Network Vision
Marcelo declares A New Day For Sprint and changes Band 41 priorities .
by Seth Goodwin
Sprint 4G Rollout Updates

Thursday, September 11, 2014 - 11:20 AM MDT


Sprint CEO Marcelo Claure has only been on the job for 3-1/2 weeks, but dramatic changes have already been made. Claure took part in Goldman Sachs 23rd Annual Communacopia Conference this morning in New York City. During the course of an approximately 35 minute onstage interview, Claure’s strategy for Sprint going forward was publicized for the first time.

Claure started by noting the advice he received as a first time CEO of a publicly traded company was “don’t make any changes for the first 100 days.” He continued “I just couldn't help myself. On day 4 we changed everything we do from the time we go to market.” In his first meeting with Sprint’s vice presidents in Overland Park, Claure asked a simple question. Why would anyone buy a Sprint phone?

The question itself was somewhat rhetorical. As Claure noted to the audience “really there wasn't really any compelling value proposition [at Sprint]." He noted that Sprint was more expensive than some of their competitors while still “coming out of a pretty traumatic network experience.” As to Framily, Claure discussed that even he himself had a hard time understanding how the plan worked, and was less than thrilled that “We were marketing with a hamster talking to people."

The Way Forward

Insight into Claure’s strategy can be traced back to his time at Brightstar. Over a 15 year period, Marcelo transformed a company from selling cellphones out of the trunk of his car in Miami, to a full scale cellular logistics corporation with over $10 billion in revenue in 2013. This entrepreneurial spirit and underdog mentality is what he is seeking to replicate at Sprint.

Plans

In the wake of complicated plans and the success of family share plans at Verizon and AT&T, Claure identified this as Sprint’s first target. Within his first four days on the job, Sprint’s post-paid plan offerings were drastically overhauled. He emphasized Sprint’s commitment to match or beat AT&T and Verizon on price as well as surpassing them by doubling the data offered on comparable competitor’s plans. By the end of Week 1, a competitive individual plan was also released.

By essentially concentrating plan offerings to two simple to understand plans, Claure sees the ability to market and sell these plans to consumers being easier going forward. He told store employees forget about the rule book “just go out there and be an entrepreneur… It is incredible when you empower your employees and allow them to be entrepreneurs the type of things that start to happen.”

Network

Claure is aware of the importance of the network. He specifically noted that he monitors network performance daily. Even with that, he is optimistic about where he's taking Sprint into the future. “The network is our product…We provide connectivity and the network needs to be good in order for customers to come.” He also was gracious towards what former CEO Dan Hesse had already accomplished on the network side before leaving. “He made a pretty bold move,” Claure said. “We basically went and did a whole rip and replace of our network.”

Marcelo noted that most of the network hardware replacement is done. Something the S4GRU sponsor site statistics bear out. Without providing details, Claure underscored something we have been hearing out of Sprint for the past several months...that the deployment of LTE Bands 25 and 26 are being accelerated with 255 million POP's now covered by Sprint LTE.

As we have discussed on this site numerous times, Spectrum is ultimately one of Sprint’s key differentiators. “We have over 160MHz in the 2.5 band. Our majority shareholders entire secret sauce in Japan was based on their 2.5 network.” Marcelo said 60 million POP's are currently covered by Band 41 LTE. These are former Clearwire WiMax sites that have been converted to Sprint’s Spark LTE. One of the more interesting aspects of this morning’s event was the change in Sprint’s 8T8R Band 41 deployment strategy.

Marcelo elaborated, “We are going to move to a smarter model in terms of how we deploy our equipment” going forward. He discussed that when he arrived, Sprint’s plan was simply to deploy new Band 41 8T8R equipment across their over 30,000 sites. Which is essentially all their existing full build Network Vision sites. The problem with this strategy according to Claure is that this “takes us too long to be good anywhere.” The new strategy has 2.5 LTE (Band 41) deployments being concentrated in areas where the existing network is overburdened.

In the second wave of the Band 41 8T8R deployment attack, Sprint will be “going strong after a few cities...focusing on a few critical markets and deploying an experience that hasn't been seen yet in the U.S.”

Shifting the focus to areas that need the extra capacity first is strategically important. If implemented properly, getting Band 41 LTE sites deployed across all markets where they are absolutely needed for extra capacity will help make the network more usable for end users. “There is no need for us to plaster the nation with 2.5, because it is going to take too long,” Claure said. “Rather we’d like to get some wins early on.”

The Near-Term Plan

To Claure, ultimately price and the network is Sprint’s winning value proposition. He noted in the wireless industry, you can either compete on price as T-Mobile has been aggressively doing as of late, or you can compete on the quality of your network as Verizon or AT&T does. That left Sprint in a precarious position, “we were the most expensive and our network is a work in progress.” Claure added, “You are going to see us now be the value driver… And potentially in the market for a really strong advertisement network.” Claure concluded, “If you can have price and the really strong network; you have a winning value proposition."

To compete on value in the near-term, expect Sprint to aggressively counteract competitor’s moves. Claure gave the example of T-Mobile announcing a guaranteed best price on a device buyback or trade-in. Later that afternoon Sprint countered, offering to do better than T-Mobile. Sprint was in part able to make this play due synergies with Claure’s former company Brightstar, now fully owned by Softbank.

Brightstar is the largest player in the phone trade-in market in the world. Claure noted synergies between Sprint and the over 1,000 companies Softbank owns or does business with are a competitive advantage. He noted that the value proposition is Sprint’s optimal strategy at this point and concluded by saying Sprint must be the ultimate disruptor in the industry.

You can say what you want about Sprint's past. But the future is changing. It's squarely in Marcelo's hands. And he's gaining momentum.




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anthony.spina97
Sep 11 2014 10:31 AM

Excellent article! :)

-Anthony

Yes!  Perfect words!

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jamisonshaw125
Sep 11 2014 10:37 AM

I love Marcelo.  I knew he would change things up. Great article Seth!

Hmmm.  So i do agree with the re prioritizing of B41 roll out to congested areas first, but I will they still place b41 everywhere eventually?  I also gather from this article that b26 is still a go for every site nationwide that doesn't have restrictions for the frequency?

Marcelo is definitely what Sprint needed at this point. I liked Dan Hesse but Marcelo reacts a lot better in this fast paced market. I am glad to see some changes happening. Thanks for the article.

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taylorcox75
Sep 11 2014 10:56 AM
In a city of 600,000 100 miles from an international border. Just some more clarification I won't see b41 for a bit.

Interesting read.  However I am a bit confused about the overall B41 strategy now.  I get the desire to shift the B41 deployment priorities to get the B41 network active in markets that are overburdened and need capacity relief but is the ultimate goal still to overlay all 39K NV sites + 16K Clearwire sites + more sites as needed?  

 

I don't mind if Sprint shifts its resources for now from having its crews start in every market to sending them to overburdened markets that they need help and just go blitzkrieg to get the B41 network up.   Claure is right in that Sprint internally desperately needs those "early wins" but more importantly Sprint needs the consumer confidence in the Sprint brand again.  This would be a good start if this can be pulled off.  I'll keep my eyes peeled for that.

Hmmm.  So i do agree with the re prioritizing of B41 roll out to congested areas first, but I will they still place b41 everywhere eventually?  I also gather from this article that b26 is still a go for every site nationwide that doesn't have restrictions for the frequency?

 

Interesting read.  However I am a bit confused about the overall B41 strategy now.  I get the desire to shift the B41 deployment priorities to get the B41 network active in markets that are overburdened and need capacity relief but is the ultimate goal still to overlay all 39K NV sites + 16K Clearwire sites + more sites as needed?  

 

I don't mind if Sprint shifts its resources for now from having its crews start in every market to sending them to overburdened markets that they need help and just go blitzkrieg to get the B41 network up.   Claure is right in that Sprint internally desperately needs those "early wins" but more importantly Sprint needs the consumer confidence in the Sprint brand again.  This would be a good start if this can be pulled off.  I'll keep my eyes peeled for that.

 

Yes, it's our understanding that Marcelo is not stopping a nationwide B41 deployment, but reprioritizing.  Instead of doing anything and everything, and just letting the market managers do what they want with deployment, he is challenging the NV Plan of anything and everything a focusing on high demand sites first.

 

I completely agree with this thinking.  Focus on LTE sites that already have backhaul in place but performance is suffering because of high demand.  Start permitting these sites first.  Focus your crews on these sites first.

 

And as these start clearing out, second focus on cities with the highest Sprint customers or where you want to attract customers.  Then third, focus on all remaining sites nationwide that have backhaul upgraded to support Band 41.  And last, catch everything else as they get backhaul upgraded.

 

Band 26 deployment is still going hot and heavy nationwide to almost every site that has LTE capable backhaul (outside the IBEZ).  He is even starting to question and push to make sure anywhere that can receive it does by the end of the year.  And the places that can't...why not?  How can we speed that up?

 

Go Marcelo!  GO!!!

In a city of 600,000 100 miles from an international border. Just some more clarification I won't see b41 for a bit.

 

I disagree.  B41 is not incumbered by the international boundary.  Sprint can deploy right up to the border.  And Marcelo said he wants to focus Band 41 on the highest usage LTE sites first.  So its the complete opposite of what you just said.  He said if there is an overburdened Sprint LTE site in your area, he's making B41 a priority for that site!

 

This is excellent news for you.  And he is also going to be pushing B26 in the IBEZ as hard as it can be pushed.  You can count on that.

Hallelujah on the B41 strategy! Sprint finally has a leader that understands the real value of that high band spectrum! 

 

Provide "one of a kind" wireless data experience in top markets, and you will have much higher ROI and customer growth. That's how it's done, it's the T-Mobile approach.

 

Exciting times ahead of us!

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IamMrFamous07
Sep 11 2014 11:10 AM
I like this new network strategy. It seems very cost effective too. I just wonder where does Carrier Aggregation (deployment) fall into play and small "spark cells" and will it still take 3 years to deploy band 41 in the top 100 cites/markets.

Also is the plan is still to cover 100 million POPs by year ends.
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taylorcox75
Sep 11 2014 11:14 AM

I disagree.  B41 is not incumbered by the international boundary.  Sprint can deploy right up to the border.  And Marcelo said he wants to focus Band 41 on the highest usage LTE sites first.  So its the complete opposite of what you just said.  He said if there is an overburdened Sprint LTE site in your area, he's making B41 a priority for that site!

 

This is excellent news for you.  And he is also going to be pushing B26 in the IBEZ as hard as it can be pushed.  You can count on that.

The city is Tucson and does 3g 800 require the permitting then for international?  Weird seeing Phoenix having really decent 3g 800 coverage then Tucson not even having one site.

I like this new network strategy. It seems very cost effective too. I just wonder where does Carrier Aggregation (deployment) fall into play and small "spark cells" and will it still take 3 years to deploy band 41 in the top 100 cites/markets.

Also is the plan is still to cover 100 million POPs by year ends.

 

Carrier Aggregation can only occur at Sprint B41 8T8R sites.  Existing Huawei and Samsung dual mode WiMax/LTE Clearwire sites cannot do CA. So Sprint will have crews running around the accepted 8T8R adding additional carrier cards and implementing CA sometime around the turn of the year.

 

It is likely that CA will appear here and there as they do it.  We won't know it until we start seeing multiple B41 LTE carriers show up at live 8T8R sites and we have Sprint B41 IntraBand CA compliant devices in hand.  

 

It's even possible that when they start firing up 8T8R sites in the next 30-45 days, they may come out of the gate with multiple carriers and CA right from the get go.  And until we start to get CA devices, we will still have multiple B41 sites that have CA enabled to spread out the loads and keep B41 speeds really high.

 

EDIT:  And yes, they are still planning to cover 100M POP's with B41 Spark LTE by year's end.  That can be achieved just by firing up the remaining Clearwire sites and already completed 8T8R sites.  That's not going to be a problem.

The city is Tucson and does 3g 800 require the permitting then for international?  Weird seeing Phoenix having really decent 3g 800 coverage then Tucson not even having one site.

 

Sprint currently cannot deploy 800MHz in Tucson because of the international boundary (CDMA Band Class 10 and LTE Band 26).  It currently looks like the best case scenario when Sprint can start that is Mid 2015.  But additional permits should not be needed for that work.

 

However, Sprint will be adding Band 41 8T8R to high usage sites in Tucson to spread out the burden and increase LTE speeds on existing sites.  This will require some additional permitting.

 

But this work is starting now.  And this will increase performance on these sites to 50-70Mbps speeds for Triband device owners, as each foes online.  And it will increase speeds on those same sites up to ~150Mbps when Carrier Aggregation starts to occur later this year and when CA capable devices start to be sold.

Outstanding.

 

This is what happens with great leadership at the helm.  No more excuses. Make it happen and stick to it.

Carrier Aggregation can only occur at Sprint B41 8T8R sites.  Existing Huawei and Samsung dual mode WiMax/LTE Clearwire sites cannot do CA. So Sprint will have crews running around the accepted 8T8R adding additional carrier cards and implementing CA sometime around the turn of the year.

 

This brings up another question I have.  Will Sprint go back and re-deploy new 8T8R RRUs for sites that have Samsung dual mode Wimax/LTE RRUs?  The Huawei ones I don't worry at all since they have to be replaced anyways.

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hercules rockefeller
Sep 11 2014 11:46 AM

Marcelo talked about the shift in B41 priorities during the all-hands call a couple of weeks ago, and Sprint's definitely not backing off of the plan to roll out b41 across the entire network. It's just a change in priorities, or really a welcome change in mindset if you think about it. Taking care of the easier rural and urban sites first before tackling the more difficult urban areas was what made sense for Sprints needs whereas the new priority is more focused on what the customer needs.

 

To be fair, there were good customer-focused reasons for working from the outside-in on network vision, as the whole point was to minimize customer impacts. But I do feel that focusing on the sites that need capacity the most whether it's easier for Sprint or not demonstrates a greater focus on the end user's needs. 

 

Ultimately in the long run being forced to build out a denser network that our competitors should leave Sprint in a more competitive position as we'll have more sectors in a given area along with greater spectrum.

This brings up another question I have.  Will Sprint go back and re-deploy new 8T8R RRUs for sites that have Samsung dual mode Wimax/LTE RRUs?  The Huawei ones I don't worry at all since they have to be replaced anyways.

 

Yes.  But it will not be the highest priority.  But put into context of what Marcelo said today, I'd have to think that if any of these legacy Clearwire sites are in high usage areas suffering performance issues, then some of them may receive 8T8R upgrades early.  Just a reasonable speculation on my part.

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OhioCalling
Sep 11 2014 12:00 PM

Great Article Seth, Thank You.  And thanks to Robert also for his continued contributions and clarifications on this article but also all of S4GRU.

Thanks to everyone for the kind comments on my first article and to Robert for sticking around to clarify questions. I'm swamped this afternoon with work.

So my guess New Orleans will be first on that list :P has there been any improvement In that market as of late?

So my guess New Orleans will be first on that list :P has there been any improvement In that market as of late?

 

If I were Marcelo, I'd have to see New Orleans as high on the list.  We don't really know much about B41 deployment in that area now.  But I doubt that Marcelo's new B41 strategy has been implemented anywhere yet.  This feels like a very sudden change in events.

"He specifically noted that he monitors network performance daily"

HappyBirthdayBlackKid.gif

Great article.  Glad to see some aggressiveness back at Sprint.  

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BlueStreak3
Sep 11 2014 03:15 PM

The network hasn't changed for the better yet. In a market that is 97% complete, I have to say that I am not that all impressed. Still dropped calls and slow data speeds. Band 41 supposedly blankets my market though I am rarely connecting to it. Not to mention the fact that my phone jumps from LTE to 3G constantly killing my battery. My phone used to last all day not it only lasts 6 hours at most. I've stuck with Sprint for the past 15 years. Not sure I can stick with them much longer. Hopefully this Claure dude is action and not all talk like Sprint has always been.