Marcelo Claure, Town Hall Meetings, New Family Share Pack Plan, Unlimited Individual Plan, Discussion Thread

[RedSpark]

Amazing what happens when you have to pay back a huge chuck of debt in 2016 and 2017.

I don't understand why Sprint hasn't tapped in to all of its financing available to surge through with CapEx, especially the $1.2 Billion of vendor financing for 2.5GHz network equipment.

 

"Can be used" means that they haven't used it.

 

See Page 17 of the Fiscal 3Q16 Investor Update (http://s21.q4cdn.com/487940486/files/doc_financials/quarterly/2016/Q3/3_Fiscal-3Q16-Sprint-Quarterly-Investor-Update-FINAL.pdf)

 

"Total general purpose liquidity was $9.1 billion at the end of the quarter, including $6.1 billion of cash, cash equivalents and short-term investments. Additionally, the company also has $1.2 billion of availability under vendor financing agreements that can be used toward the purchase of 2.5GHz network equipment."

 

"During the quarter the company issued $3.5 billion of spectrum-backed senior secured notes at 3.36 percent, which is about half of Sprint’s current effective interest rate, as part of a $7 billion program aimed at diversifying the company’s funding sources, lowering its cost of capital, and reducing future cash interest expenses. The company also retired $2.3 billion of debt maturities with significantly higher coupon payments and repurchased the devices sold in the first MLS transaction, thus eliminating the associated future lease obligation."

 

"Based on the company’s sustained operational performance and improved liquidity, Moody’s Investor Service recently upgraded Sprint’s corporate family rating from B3 to B2."

[IamMrFamous07]

Looks like Shentel is testing Massive Mimo

 

https://www.wirelessweek.com/news/2017/02/blue-danube-reveals-fdd-massive-mimo-trials-t-shentel

[Arysyn]

$60,000,000 on network expansion for 2016? I believe you on the figure but where is that from? Quarterly Reports?

I'd like an update on what Sprint is planning to spend for 2017 and how many towers will get band 41 this year.

 

I know this new promo plan by Sprint isn't perfect, especially since it excludes current customers - something which hopefully might change soon considering all the complaints Sprint is receiving through social media about the omission of current customers from eligibility in the new plans, but I would likely join Sprint if they were going to make a major band 41 deployment on the towers here in the Chicago area, which may be where I got the 50% figure from regarding the network around here, not national.

 

I'm not as concerned about Sprint putting up new towers, but that Sprint at least fully equip the towers they currently have. The problem I have with it, as I do about a lot in life, is the idea of having areas of something not as good in both quality and quantity as in other areas. I'd prefer there be slightly above average in 100% of a given space, than 50% great, and 50% not so great, or 75/25, etc. Even worse is when there is added quantity to a space, while the quality or quantity elsewhere is lacking/technically unfinished.

 

The latest OpenSignal Reports ought to be a wake-up call to Sprint to begin finishing their existing network quality/quantity build of what currently exists, filling in network gaps within current coverage areas, rather than take on new areas. Sprint needs to do that, instead of focusing on bragging about their spectrum. I agree with those here who are tired of Sprint doing just that and believe Sprint is using that to conceal the problems.

[clbowens]

Has anybody tried to sign up for the new plan today?

[Terrell352]

Has anybody tried to sign up for the new plan today?

I did this morning. I got a big fat no go

 

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[Arysyn]

I did this morning. I got a big fat no go

 

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Its a shame Sprint isn't offering it. Very disappointing, Hopefully that'll change soon. 

[RedSpark]

Marcelo is now calling AT&T dumb for its Unlimited Plan pricing and saying how "Big Blue is panicking". I liked him better when he wasn't trying to channel Legere.

 

https://twitter.com/marceloclaure/status/832368453067603969

 

"1/ If @ATT has been #asleepatthewheel, they must’ve just hit a curb! “New” #unlimited plan sucks just a little bit less than it used to."

 

https://twitter.com/marceloclaure/status/832368453227003904

 

"2/ @ATT ditched the TV requirement (smart) but still charges WAAY too much for #unlimited (dumb). #BigBlueIsPanickingToo"

 

https://twitter.com/marceloclaure/status/832368831335133184

 

"3/ @Sprint’s #Unlimited HD is STILL the BEST value on the planet!! (link: http://bit.ly/2kP8NEj) bit.ly/2kP8NEj"

 

The outright neglect of current customers is a bit shocking, especially since he took care of longtime customers with Loyalty Credits and the like when he came on board as CEO. I'm a bit stunned.

 

Hey Marcelo: it's not dumb pricing when all customers can get it... and they aren't panicking as much as you are.

[spotmeterf64]

He cannot try to cultivate the cult of personality that Legere has.

[Fraydog]

Marcelo is now calling AT&T dumb for its Unlimited Plan pricing and saying how "Big Blue is panicking". I liked him better when he wasn't trying to channel Legere.

 

https://twitter.com/marceloclaure/status/832368453067603969

 

"1/ If @ATT has been #asleepatthewheel, they must’ve just hit a curb! “New” #unlimited plan sucks just a little bit less than it used to."

 

https://twitter.com/marceloclaure/status/832368453227003904

 

"2/ @ATT ditched the TV requirement (smart) but still charges WAAY too much for #unlimited (dumb). #BigBlueIsPanickingToo"

 

https://twitter.com/marceloclaure/status/832368831335133184

 

"3/ @Sprint’s #Unlimited HD is STILL the BEST value on the planet!! (link: http://bit.ly/2kP8NEj) bit.ly/2kP8NEj"

 

The outright neglect of current customers is a bit shocking, especially since he took care of longtime customers with Loyalty Credits and the like when he came on board as CEO. I'm a bit stunned.

 

Hey Marcelo: it's not dumb pricing when all customers can get it... and they aren't panicking as much as you are.

 

 

Marcelo found a company with a worse response, the company that barely wants to be in consumer wireless. ¯\_(ツ)_/¯ 

[RedSpark]

Read the responses of Sprint and it's CMO, Roger Solé, in this article:

 

http://www.usatoday.com/story/tech/2017/02/16/sprint-returns-fire-ups-its-unlimited-plan/97995290/

 

"You must be a new Sprint customer to qualify. The company recommends existing subscribers visit their local store to find the best options for them."

 

Just put it on the store reps...

 

""We don't want someone to say 'ah ok, Sprint is the best value proposition but it's not HD,'" continues Solé. "So let's remove that obstacles from the conversation.""

 

Totally out of touch with the current customer base.

[jamesinclair]

MetroPCS has now made its $50/5GB plan unlimited (with 480p video and no tethering) to go along with its $60 unlimited plan with 8GB of tethering and HD video. Both prices include taxes and fees.

 

Are they prepaid or postpaid?

 

....And does it even matter these days with BYOD?

 

 

The network has improved a lot since Marcelo took over but Sprint seems to have ran out of steam, haven't seen any improvements in a long while now. And there are still some areas that are lacking optimization so you lose service or get stuck on a sliver of useless 3G.

 

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The big sign for me that something was wrong was last November. Sprint had absolutely nothing for Black Friday. Nothing.

 

[jamesinclair]

"You must be a new Sprint customer to qualify. The company recommends existing subscribers visit their local store to find the best options for them."

 

Just put it on the store reps...

 

 

 

Ridiculous, nobody likes going to a cell phone store and talking to reps. It probably ranks just above strolling through the used-car lot.

[Mr.Nuke]

 I still see a ton of Sprint customers porting out to other carriers simply because of no offers being given to loyal customers.

 

This may be true (I question it given churn data is available), but when you start doing basic math you see why they aren't doing much. Churn itself is obviously a measurable metric. We get it for every quarter lagging several months for the earnings announcement. I'm going to overly generalize the basic math to illustrate a point in the following. My math is most certainly an oversimplification. It clearly doesn't account for the costs of retaining a customer being less than attracting new ones among other factors. I fully acknowledge that. The math obviously gets a bit more complicated if they're churning higher than average ARPU customers and replacing them with new lower than average customers, which is unquestionably happening; and may happen more so with the recent rate plan war. That said…

 

Sprint has roughly 30 million post paid subs right now at an ARPU of roughly $50 dollars (the ARPU is irrelevant for this other than to establish a baseline revenue estimate). That yields $1.5 billion per month or $18 billion annually in revenue.

 

If you assume churn at 2% (they've been lower than this recently, but it is probable that it rises with the recent "changes" in the market), of Sprint's ~30 million subs they lose 2.4 million annually to churn. Keeping ARPU constant @ $50 that yields $16.5 billion in revenue post churn, down from the $18 billion.

 

Theoretically speaking say we give every post-paid sub a $5 a month "loyalty credit." Furthermore, lets assume said credit reduces churn by 50% i.e. 1.2 million subs are leaving instead of 2.4 million annually. That yields $15.552 billion in annual revenue or $1 billion less than if you let every churn customer leave and kept rates constant. Also known as an extra $1 billion in losses annually, something Sprint can obviously ill afford. Much like the CapEx a lot of it is Sprint not being in a fiscal position to do anything about it.

 

That said, when you start doing basic math given the current churn rates it becomes pretty obvious why Sprint isn't doing anything in the customer loyalty category. If we have 10 customers paying $50 a month and we lose 1 the revenue still equals 9 customers a month paying $45 per month. Marcelo and Sprint are constantly doing this math behind the scenes. If a loyalty credit made sense, they'd be doing it.

[RedSpark]

This may be true (I question it given churn data is available), but when you start doing basic math you see why they aren't doing much. Churn itself is obviously a measurable metric. We get it for every quarter lagging several months for the earnings announcement. I'm going to overly generalize the basic math to illustrate a point in the following. My math is most certainly an oversimplification. It clearly doesn't account for the costs of retaining a customer being less than attracting new ones among other factors. I fully acknowledge that. The math obviously gets a bit more complicated if they're churning higher than average ARPU customers and replacing them with new lower than average customers, which is unquestionably happening; and may happen more so with the recent rate plan war. That said…

 

Sprint has roughly 30 million post paid subs right now at an ARPU of roughly $50 dollars (the ARPU is irrelevant for this other than to establish a baseline revenue estimate). That yields $1.5 billion per month or $18 billion annually in revenue.

 

If you assume churn at 2% (they've been lower than this recently, but it is probable that it rises with the recent "changes" in the market), of Sprint's ~30 million subs they lose 2.4 million annually to churn. Keeping ARPU constant @ $50 that yields $16.5 billion in revenue post churn, down from the $18 billion.

 

Theoretically speaking say we give every post-paid sub a $5 a month "loyalty credit." Furthermore, lets assume said credit reduces churn by 50% i.e. 1.2 million subs are leaving instead of 2.4 million annually. That yields $15.552 billion in annual revenue or $1 billion less than if you let every churn customer leave and kept rates constant. Also known as an extra $1 billion in losses annually, something Sprint can obviously ill afford. Much like the CapEx a lot of it is Sprint not being in a fiscal position to do anything about it.

 

That said, when you start doing basic math given the current churn rates it becomes pretty obvious why Sprint isn't doing anything in the customer loyalty category. If we have 10 customers paying $50 a month and we lose 1 the revenue still equals 9 customers a month paying $45 per month. Marcelo and Sprint are constantly doing this math behind the scenes. If a loyalty credit made sense, they'd be doing it.

Good points. However, the true cost of a lost customer is one that doesn't come back and tells others not to go.

[samwelltarley]

This may be true (I question it given churn data is available), but when you start doing basic math you see why they aren't doing much. Churn itself is obviously a measurable metric. We get it for every quarter lagging several months for the earnings announcement. I'm going to overly generalize the basic math to illustrate a point in the following. My math is most certainly an oversimplification. It clearly doesn't account for the costs of retaining a customer being less than attracting new ones among other factors. I fully acknowledge that. The math obviously gets a bit more complicated if they're churning higher than average ARPU customers and replacing them with new lower than average customers, which is unquestionably happening; and may happen more so with the recent rate plan war. That said…

 

Sprint has roughly 30 million post paid subs right now at an ARPU of roughly $50 dollars (the ARPU is irrelevant for this other than to establish a baseline revenue estimate). That yields $1.5 billion per month or $18 billion annually in revenue.

 

If you assume churn at 2% (they've been lower than this recently, but it is probable that it rises with the recent "changes" in the market), of Sprint's ~30 million subs they lose 2.4 million annually to churn. Keeping ARPU constant @ $50 that yields $16.5 billion in revenue post churn, down from the $18 billion.

 

Theoretically speaking say we give every post-paid sub a $5 a month "loyalty credit." Furthermore, lets assume said credit reduces churn by 50% i.e. 1.2 million subs are leaving instead of 2.4 million annually. That yields $15.552 billion in annual revenue or $1 billion less than if you let every churn customer leave and kept rates constant. Also known as an extra $1 billion in losses annually, something Sprint can obviously ill afford. Much like the CapEx a lot of it is Sprint not being in a fiscal position to do anything about it.

 

That said, when you start doing basic math given the current churn rates it becomes pretty obvious why Sprint isn't doing anything in the customer loyalty category. If we have 10 customers paying $50 a month and we lose 1 the revenue still equals 9 customers a month paying $45 per month. Marcelo and Sprint are constantly doing this math behind the scenes. If a loyalty credit made sense, they'd be doing it.

That is the logic of a manager who only thinks to maximize revenue for the CURRENT quarter with no regard to the future. And yes that's exactly how Marcelo thinks.

 

By the way churn is conventionally a monthly metric. From your math it's clear you mistook it as a quarterly one.

 

 

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[samwelltarley]

Wait is someone really saying less then 1/4 of sprint macro sites (~40,000) don't have 8t8r?

 

More than 5000 were deployed in the initial wave of 2013-2014 and deployment continued rapidly well into 2015 before it was halted en mass at the end of 2015 when Marcelo began his cost cutting.

 

Approximately a tad over half of sprints total LTE sites have 8t8r now and that number is increasing every day thanks to renew Capex expenditures at the later half of 2016 which included small cell orders, new B41 macro site colocation using mini macros (hello the previously undeployed southern states), adoption of DAS Node usage, and bringing GMO/ non LTE sites in house as high priority sites targeted for LTE activation.

 

Stuff is happening and did happen. To say otherwise is just rubbish. No one is happy about the what $60,000,000 (yes, that little, they knew exactly how much they were going to spend last year from the get go) they spent on network expansion for the entirety of 2016 but it is what it was and so be it but to say they're doing nothing now is rubbish and there's proof from multiple regions across multiple vendors all across the country.

 

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Were you trying to refute my data points? It was certainly hard to tell when you're citing data points that are consistent with mine.

 

 

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[Flompholph]

Were you trying to refute my data points? It was certainly hard to tell when you're citing data points that are consistent with mine.

 

 

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What are your data points? We know how many sites had lte in Nov 2015. And we know 70% of lte sites have B41. So we know at least >55% have B41. And that is assuming no new lte sites. But they have added lte over the last year.

 

Where did your small cell number come from? We know of 10+ markets that have small cells.

[Arysyn]

Marcelo found a company with a worse response, the company that barely wants to be in consumer wireless. ¯\_(ツ)_/¯

Based on their poor help with my Uverse home internet problems today, I'd have to say they must barely want to be in the consumer internet market either.

[Arysyn]

Ridiculous, nobody likes going to a cell phone store and talking to reps. It probably ranks just above strolling through the used-car lot.

Yeah, and finding a salesman with the personality of John Legere combined with the skills of Gary Forsee.

[ericdabbs]

This may be true (I question it given churn data is available), but when you start doing basic math you see why they aren't doing much. Churn itself is obviously a measurable metric. We get it for every quarter lagging several months for the earnings announcement. I'm going to overly generalize the basic math to illustrate a point in the following. My math is most certainly an oversimplification. It clearly doesn't account for the costs of retaining a customer being less than attracting new ones among other factors. I fully acknowledge that. The math obviously gets a bit more complicated if they're churning higher than average ARPU customers and replacing them with new lower than average customers, which is unquestionably happening; and may happen more so with the recent rate plan war. That said…

 

Sprint has roughly 30 million post paid subs right now at an ARPU of roughly $50 dollars (the ARPU is irrelevant for this other than to establish a baseline revenue estimate). That yields $1.5 billion per month or $18 billion annually in revenue.

 

If you assume churn at 2% (they've been lower than this recently, but it is probable that it rises with the recent "changes" in the market), of Sprint's ~30 million subs they lose 2.4 million annually to churn. Keeping ARPU constant @ $50 that yields $16.5 billion in revenue post churn, down from the $18 billion.

 

Theoretically speaking say we give every post-paid sub a $5 a month "loyalty credit." Furthermore, lets assume said credit reduces churn by 50% i.e. 1.2 million subs are leaving instead of 2.4 million annually. That yields $15.552 billion in annual revenue or $1 billion less than if you let every churn customer leave and kept rates constant. Also known as an extra $1 billion in losses annually, something Sprint can obviously ill afford. Much like the CapEx a lot of it is Sprint not being in a fiscal position to do anything about it.

 

That said, when you start doing basic math given the current churn rates it becomes pretty obvious why Sprint isn't doing anything in the customer loyalty category. If we have 10 customers paying $50 a month and we lose 1 the revenue still equals 9 customers a month paying $45 per month. Marcelo and Sprint are constantly doing this math behind the scenes. If a loyalty credit made sense, they'd be doing it.

 

I don't think most current Sprint customers care for a "loyalty credit" vs. being able to take advantage of promos. I mean honestly I think from getting the pulse of current customers if they can move their ED1500 or other legacy plan lines to the new Unlimited Freedom plan that they would be willing to stay.

 

There are some perks with the new Unlimited Freedom plan mainly the 10 GB hotspot tether that most legacy plans do not have that feature included in their plan which is enticing to a lot of folks.  Given now that a lot of adults have multiple devices that require connectivity, I can see why people would be willing to give up their beloved ED1500 plan which for the longest time was hailed as the best plan to maintain despite all these new promos and move to the new plan.  

 

If you simply look at Tmobile, you have people who are now even talking about giving up their Simple Choice plans to jump to the new Tmobile One which for a long time was a no-no due to the fact that it had SD video streaming and crappy 3G only hotspot.  Who would have thought that they would be the case and Tmobile is actually encouraging folks to jump to the new plan.

 

I get the math and I appreciate the analysis but I think at this point with this price war going on from all the carriers, maintaining customers should just be as important as attracting new ones for damage control.  It is leaving a bitter taste in a lot of current Sprint customers and I am sure a decent amount of customers will be flocking to other carriers mainly Verizon and Tmobile starting today.  People choose Sprint for the value proposition which is why the 50% off deal was popular and actually gained some momentum.  If people are stuck in more expensive legacy plans now, people will start to evaluate their plans and seeing if its worth staying if they can get better service elsewhere for the same price.  Once you lose that loyal customer, it will be hard to grab them back which we all know there is a cost for customer acquisition.  A paying customer is always better than not having a customer and of course the word that gets spread around from former customers about Sprint service reputation can have a negative effect as well.

[JossMan]

I did this morning. I got a big fat no go

 

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Yep, same here I tried yesterday and figured I would try again today I'm 0-2...

 

I'm interested in switching to an unlimited plan but if Sprint isn't willing to give these promotions to current customers I will be looking at T-Mobile this weekend. 

[JThorson]

I need to say this, I'm getting sick and tired of hearing a lot of people whine and complain about how Marcelo and Sprint aren't doing the right thing (from their perspective). I feel like people are letting all their emotions speak and it's getting annoying.

 

I get people are upset but that doesn't give you the right to complain.

[Terrell352]

I need to say this, I'm getting sick and tired of hearing a lot of people whine and complain about how Marcelo and Sprint aren't doing the right thing (from their perspective). I feel like people are letting all their emotions speak and it's getting annoying.

 

I get people are upset but that doesn't give you the right to complain.

Fact you pay for service you ALWAYS have the right to complain. Or you can switch carriers.

 

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[JeffDTD]

For anyone upset with sprint's pricing for current customers-  if they aren't meeting your needs and /or you want to pay more for service/quality, the best thing you can do is in fact just leave.  It doesn't surprise me that Sprint hasn't slashed the price for current subs yet.  Its "wait and see" at this point.  What is the effect on churn?   When he was first hired, Marcelo bragged about being intimately involved in monitoring growth and churn on a day to day basis.  Is he still doing that?  Surely to some degree.  If sprint sees a massive defection, there will be a reaction.   As for the fantasy wireless plans we dream up and our desires to leave, we are still only a tiny % of the sprint population. 

[RedSpark]

I need to say this, I'm getting sick and tired of hearing a lot of people whine and complain about how Marcelo and Sprint aren't doing the right thing (from their perspective). I feel like people are letting all their emotions speak and it's getting annoying.

 

I get people are upset but that doesn't give you the right to complain.

I don't think I've been emotional about it. I think I've been empirical about it.

 

When you don't take care of your customers, someone else will... and that's happening here. Multiple S4GRU people have left Sprint and they're probably not coming back for a year or two or perhaps ever. These loyal customers are being replaced by deal seekers who will bolt from Sprint once the price jumps.

 

This is how a company folds.