Softbank - New Sprint - Discussion

[Conan Kudo]

Sprint and T-Mobile currently do not produce a profit; Sprint losing billions of dollars for the past decade. In this case, stability might mean that the two survive and effectively compete against AT&T+Verizon.

We don't know about the long-term health of either of these two companies because all financials right now are influenced by the heavy spending on network upgrades right now. You can't just subtract it, either, because there's always a degree of capex spending involved.

 

You can look at previous trends and develop a model of what it might be like if Network Vision and the modernization program were completed. Here's what I see it being like:

 

Sprint would still be losing money, but the loss would be narrower. However, the lack of the headline loss would cause more to peek into the deeper problems, such as poor execution ability. There are some serious fundamental issues with Sprint that need to be addressed, but hopefully Masa is working on that as we speak.

 

T-Mobile would be turning a profit of about $1 billion, because it would ordinarily ease off into $2.9-3.2 billion of capex if modernization wasn't accelerated. Because T-Mobile has been firing on all cylinders and is quite ahead of schedule, it went ahead and accelerated its program, which pushed it down to lose money for the quarter.

[bigsnake49]

Let's think about this. Both Sprint and T-Mobile have to spread both capex and opex + debt service for a nationwide network over a much smaller customer base. They will never attain the margins that the other two will. They will always be behind. They will always be disadvantaged.

 

So why not share a network and reduce their per customer expenses? Well, it has not happened yet, has it? How will Sprint or T-Mobile then be poaching customers from each other if they can't crow about their superior network? If they don't compete against each other, the regulators might get suspicious.

[irwinshere]

We don't know about the long-term health of either of these two companies because all financials right now are influenced by the heavy spending on network upgrades right now. You can't just subtract it, either, because there's always a degree of capex spending involved.

 

You can look at previous trends and develop a model of what it might be like if Network Vision and the modernization program were completed. Here's what I see it being like:

 

Sprint would still be losing money, but the loss would be narrower. However, the lack of the headline loss would cause more to peek into the deeper problems, such as poor execution ability. There are some serious fundamental issues with Sprint that need to be addressed, but hopefully Masa is working on that as we speak.

 

T-Mobile would be turning a profit of about $1 billion, because it would ordinarily ease off into $2.9-3.2 billion of capex if modernization wasn't accelerated. Because T-Mobile has been firing on all cylinders and is quite ahead of schedule, it went ahead and accelerated its program, which pushed it down to lose money for the quarter.

Dont understand how you look at previous trends for Sprint as though anything they have done in the past would necessarily be repeated. Nextel is gone, softbank is here, network vision, 800 voice, 2600 lte should all change the landscape. Just asking ...

 

Jim, Sent from my Photon 4G using Tapatalk 2

[Conan Kudo]

Dont understand how you look at previous trends for Sprint as though anything they have done in the past would necessarily be repeated. Nextel is gone, softbank is here, network vision, 800 voice, 2600 lte should all change the landscape. Just asking ...

 

Jim, Sent from my Photon 4G using Tapatalk 2

Once the main Network Vision program is done, Sprint will ease off capex and reduce it accordingly, which naturally changes the balance sheet. After this year, I'd expect significant cuts in capex to shift Sprint back to profitability.

[lilotimz]

Once the main Network Vision program is done, Sprint will ease off capex and reduce it accordingly, which naturally changes the balance sheet. After this year, I'd expect significant cuts in capex to shift Sprint back to profitability.

 

It's $8 billion capex this year and next which is a solid increase from the $5 billion spent last year. NV 1.0 may be coming to a close but NV 2.0 and rolling out the new 8 pipe radios over the entire network and more is only just beginning. 

[Conan Kudo]

It's $8 billion capex this year and next which is a solid increase from the $5 billion spent last year. NV 1.0 may be coming to a close but NV 2.0 and rolling out the new 8 pipe radios over the entire network and more is only just beginning. 

Are there any opex changes then? Because wasn't part of Network Vision supposed to reduce opex by simplifying network structures?

[bigsnake49]

We don't know about the long-term health of either of these two companies because all financials right now are influenced by the heavy spending on network upgrades right now. You can't just subtract it, either, because there's always a degree of capex spending involved.

 

You can look at previous trends and develop a model of what it might be like if Network Vision and the modernization program were completed. Here's what I see it being like:

 

Sprint would still be losing money, but the loss would be narrower. However, the lack of the headline loss would cause more to peek into the deeper problems, such as poor execution ability. There are some serious fundamental issues with Sprint that need to be addressed, but hopefully Masa is working on that as we speak.

 

T-Mobile would be turning a profit of about $1 billion, because it would ordinarily ease off into $2.9-3.2 billion of capex if modernization wasn't accelerated. Because T-Mobile has been firing on all cylinders and is quite ahead of schedule, it went ahead and accelerated its program, which pushed it down to lose money for the quarter.

Once the network modernization is finished, I fully expect Sprint to return to profitability. It will never attain the margins of the big 2. Heck, it had positive cash flow during the doldrum years and the losses were due to depreciation.

[centermedic]

He needs less Tab instead of more!

 

Sent from my LG-LS980

How about more cowbell?

 

[dkyeager]

Are there any opex changes then? Because wasn't part of Network Vision supposed to reduce opex by simplifying network structures?

the 8t8r equipment starts in the nv cabinet and uses the hybrid cables. It will eventually replace the clear /b41 LTE network and allow for reduced site expenses.

 

sent by tapatalk from my LS-980 (G2)

[irwinshere]

Are there any opex changes then? Because wasn't part of Network Vision supposed to reduce opex by simplifying network structures?

There must be some savings starting to show up from the nextel shutdown.

 

 

Jim, Sent from my Photon 4G using Tapatalk 2

[centermedic]

Are there any opex changes then? Because wasn't part of Network Vision supposed to reduce opex by simplifying network structures?

Part of the savings was the projected reduction of towers in use. That portion of the savings will probably not be realized due to the expansion of 2500.

[bigsnake49]

Part of the savings was the projected reduction of towers in use. That portion of the savings will probably not be realized due to the expansion of 2500.

 

Yes and no. A few of the free standing (not collocated) Clearwire sites will be be left to provide coverage/capacity. The rest will be collocated with Sprint NV sites. It won't be another separate network. On top of that the electricity bills on the Nextel network were murderous.

[marioc21]

We may be seeing first signs of movement.  DT may have given the greenlight to the merger. Unfortunately the source article is behind a paywall.  Haven't seen any other references yet.

 

http://www.theflyonthewall.com/permalinks/entry.php/TMUS;S;SFTBF;DTEGYid2017393/TMUS;S;SFTBF;DTEGY-Softbank-purchase-of-TMobile-approved-by-Deutsche-Telekom-Kyodo-News-says

[Stevero]

http://news.yahoo.com/deutsche-telekom-accepts-softbanks-offer-buy-t-mobile-122247354--finance.html

 

(Reuters) - Deutsche Telekom AG has agreed to a plan by Japanese mobile company Softbank Corp to buy T-Mobile US Inc, the fourth-largest U.S. mobile carrier, Kyodo news agency reported, citing industry sources.

Deutsche Telekom owns two-thirds of T-Mobile US. A spokesman for Deutsche Telekom declined to comment.

Softbank Chairman Masayoshi Son proposed the buyout in a meeting with top executives of T-Mobile and Deutsche Telekom in mid-May and received a positive response, Kydo reported.

 

Says pretty much the same thing, maybe a little verification that it did indeed happen.

[Paynefanbro]

Well I can imagine what the response to this is going to be.

[nmbr1scoobs]

Wonder if this will be talked about at Uncarrier 5.0 on June 18. They just announced the event yesterday.

[marioc21]

Like it or not, Masa Son is going to try to get this deal done. Of course the easy part is getting DT to agree.  Now we'll see what kind of determination Masa truly has once he goes up against the feds. 

[Fraydog]

No way of knowing what's going on. 

 

But I'm going out on a limb... if any of you think Legere is going away, prepare for disappointment. I'm betting Legere, Neville Ray, and Braxton Carter will all be part of the Sprint executive team. 

[jamisonshaw125]

No way of knowing what's going on. 

 

But I'm going out on a limb... if any of you think Legere is going away, prepare for disappointment. I'm betting Legere, Neville Ray, and Braxton Carter will all be part of the Sprint executive team. 

At this point, I really don't care. I just want this to be done and over with. If Legerre has to be the face, then so be it. Also, what would be the almost immediate effect of a merger. Would we notice any changes? Signal wise...I'm asking if we can run on Tmobiles LTE bands.

[Fraydog]

Even if Sprint divests EBS spectrum, they'll still have 60 MHz of T-Mobile spectrum on average per market and 60 MHz of Clearwire spectrum left, enough spectrum to run 3 20 MHz carriers of TD-LTE and a 20x20 block of FD-LTE. 

[cavendano]

Looks like they want it to be Tmobile and not Sprint

http://www.marketnewscall.com/big-news-sprint-corporation-nyses-apple-inc-nasdaqaapl/1225951/

[nmbr1scoobs]

http://www.cnet.com/news/softbanks-masa-son-on-why-sprint-needs-t-mobile/

 

In a reply back to CNET, John Legere said that he really admires Masa Son. No doubt he's running the company.

[marioc21]

http://www.cnet.com/news/softbanks-masa-son-on-why-sprint-needs-t-mobile/

 

In a reply back to CNET, John Legere said that he really admires Masa Son. No doubt he's running the company.

 

All the pre-merger rumor stories had it with Leger and Tmo basically taking over sprint.  Hesse did that bloomberg interview a few weeks back in which he said he didn't mind leaving the company and going to do something else. 

[Fraydog]

A big welcome to our new Magenta overlords!   

 

http://www.freemagenta.nl/?page_id=121

[Paynefanbro]

Please no Magenta. They can stay yellow or even adopt a black and white color scheme.