RedSpark

I heard 5 in the market already, I have a feeling there are a couple of devices that support 3XCA that are not on our radar.

I could have sworn he was referring to devices that weren't released yet.

We'll have to see the transcript when it's posted at Sprint's Investor's Site.

If I just heard correctly, John Saw just said that Sprint will have a total of Five 3xCA capable devices....

Two are on the market now (S7/S7 Edge).... and three more are on the way.

I'll bet one of them is the iPhone 7.

Marcelo just said during the call:

 

So, when we talk about churn, we just reported our lowest ever postpaid phone churn of 1.39%, which was down 10 basis points year-over-year. We don't anticipate any changes. We're putting a lot of our energy towards keeping our customers happy. But I think the most remarkable part is the network experience that our customers are getting. You can see, I mean, churn is the voice of the customer, whether they're satisfied for the value they're getting and the quality of the product, and it's been, I think, six consecutive quarters in which we continued to drive churn down in pretty much in, I'd say, relation to the company's performance, many times it's record churn. So we feel very good as it relates to churn.

 

Obviously, the best way to grow is by keeping your customers. So last quarter was a good quarter in terms of that we're able to increase our gross adds, while at the same time lowering churn. So that way you get a ripple effect, and we expect that to continue.

 

The Investor Update has some good info:

Tri-band LTE phones represented 73 percent of the 25.3 million ending postpaid phone connection base compared to 46 percent at the end of the year-ago quarter and 69 percent at the end of the prior quarter. During the quarter, 91 percent of postpaid phones sold were tri-band.

So 27% of the postpaid device base is still on non-triband LTE devices (Single/Dual LTE Band). That's still a substantial number.

Smartphones represented 93 percent of the ending postpaid phone connection base compared to 89 percent at the end of the year-ago quarter and 92 percent at the end of the prior quarter. During the quarter, 97 percent of postpaid phones sold were smartphones.

Seems to be the way the market is going.

Carrier aggregation capable phones, which allow for higher data speeds, were 74 percent of postpaid phones sold during the quarter, increasing the number of these phones within the phone base to 35 percent.

In the prior quarter (Q415) Investor Update (See Page 5) : "Carrier aggregation capable phones, which allow for higher data speeds, were 74 percent of postpaid phones sold during the quarter, increasing the number of these phones within the phone base to 28 percent."

So there's definitely growth here vs. last quarter, but quite a way to go!

Who's tuning in for the Conference Call or Webcast?

@marceloclaure: 1/7 FY 2016 is off to a great start at @Sprint! 173K postpaid phone net adds - The best Q1 result in 9yrs https://t.co/5BRu3rriyi/s/meSr

 

@marceloclaure: 2/7 We were postpaid net port positive against ALL 3 national carriers, w/400K more postpaid net adds than @ATT https://t.co/DMK0ESoJCS/s/Z4dj

 

@marceloclaure: 3/7 It doesn't stop at net adds.1QFY16 1.39%postpaid churn was the best in @Sprint's 20yr wireless history https://t.co/94i4ZWCyWP/s/Jhlk

 

@marceloclaure: 4/7 'How?' Well, that's the best part! Our network is performing better than ever & everyone is taking notice https://t.co/XjKGGwFTQy/s/0rDY

 

@marceloclaure: 5/7 We've also streamlined our business, eliminating waste & reducing costs https://t.co/4N1YTkxC3w/s/XYC4

m.twitter.com/marceloclaure

 

@marceloclaure: 6/7 AND as we continue to make strides w/our #SprintNow transformation the results speak for themselves https://t.co/bh1p2jIBkU/s/-4Va

 

@marceloclaure: 7/7 I'll be on @CNBC #SquawkOnTheStreet after the earnings call around 10:15 ET w/@carlquintanilla. Tune in for more info on our results!

Over $550 million of year-over-year reduction in cost of service and selling, general, and administrative expenses

--> That's a substantial chunk of money.

LTE Plus Network now available in 237 markets

--> Good!

2.5GHz spectrum now carries more of Sprint’s LTE traffic than any other spectrum band

--> Good metric. Sprint has to keep seeding the userbase with 2xCA/3xCA devices.

Apparently Marcelo threw a big party at his house over the weekend for executives (and their families) who relocated to Kansas City to work for Sprint.

http://www.kansascity.com/news/business/article91533162.html

Some interesting interviews. Nice house too!

I think that Son bought Sprint with the express purpose of merging with T-Mobile and provide a strong alternative to the Big 2. Since T-Mobile already had a pretty well developed LTE network, capex would be lower since Sprint's frequencies could be added to T-Mobile's sites at a fraction of the cost to upgrade Sprint's network. Unfortunately it did not happen according to plan. SoftBank is not investing in Sprint anymore and I personally think it is grooming it for sale. Cut costs, make it profitable show some additions and then let it become somebody else's problem. Sprint just needs to grow organically since SoftBank is not investing in it. Who knows, maybe that will make it more entrepreneurial and nimble, able to execute. One thing that Sprint needs to do is finance its debt at a much lower interest rate. It is really dragging them down.

We might see big gains on Monday. Hoping for good news from Marcelo and the rest of the executive team during the Earnings call.

Even having more money doesn't mean you have to spend it haphazardly.

I'm not suggesting Sprint engage in haphazard spending. However, the bar for what passes as acceptable immediate/short-term ROI would be lowered if Sprint had more funds to work with.

Williamsport, PA would get LTE, etc. You'd have full macro builds instead of GMO's. More markets would get LTE Plus. The holdover dual mode Clearwire equipment would get swapped out for new 8T8R equipment in more places and more quickly.

Has anyone considered that perhaps those sites are not upgraded because the focus is elsewhere? 

Having additional money would enable Sprint to broaden its focus... assuming permitting and equipment availability weren't limiting factors.

Yeah it would if the reason or even a factor in sites not getting upgraded faster was reducing capital expenditures trying to minimize overall losses. Sprint had initially said they were going to spend $15 billion on network expansion over 3 years ($5 billion a year on average). In May, they lowered their guidance to $3 billion for this year.

 

At the time Claure brushed it off that they were using data to strategically target where to put additional sites and thus deferring the expense as well as looking at lower cost options like femtocells. This is in pretty stark contrast to the previous strategy where Claure had said we are going to put 2.5 on every site we possibly can and Sprint walked away from many already permitted sites*.

 

It seems pretty evident that more money would've allowed Claure to carry out his original plan and would've indeed lead to sites getting upgraded faster. Instead, Sprint is once again forced to try and do the best with what they've got.

 

 

*I realize Omaha isn't a major market and will never be a big market for Sprint, but just as an example they walked away from about 45 permitted 8T8R sites here and there hasn't been any observed Band 41 site activity for 10 months.

Good points.

How much money would it have cost Sprint to upgrade those 45 8T8R sites?

If Sprint was to start over with the permitting process on those, how long of a time frame are we looking at?

Not really though. Profit isn't a magical number that comes from having money thrown at it. Same goes for Sprint as a company. Throwing money at things won't make sites get upgraded faster, won't get permitting done faster.

Wouldn't throwing money at protection sites in Montana get them upgraded sooner?

Wouldn't throwing money at 3G areas like Central/West PA (especially Williamsport, PA, etc.) (or no coverage areas) enable them to get LTE sooner, and not force Sprint to compromise on its deployment by using GMO's?

Both of these situations seem to be due to a shortage of money/funding, and not equipment or permitting delays. Of course, if I'm wrong on this, please set me straight! 

Okay everyone, lets get back on topic here and stop talking about who poops where.

 

With this whole ARM acquisition, what are people's thoughts regarding Sprint? Of course you hear rumors on how Softbank is done with Sprint and blah blah, but I don't believe that is the case. I still think Softbank is invested in Sprint but is waiting for Marcelo to make it more profitable. But as I asked, what is everyone's thoughts regarding this and the future of Sprint?

Marcelo seemed hyped about it: https://twitter.com/marceloclaure/status/755117746258604032

I'd give him the benefit of the doubt that something good is in the works.

Any one up for a good laugh, read this. http://www.tmonews.com/2016/06/t-mobile-three-channel-carrier-aggregation-testing-spotted-dallas/

 

Sent from my 2PQ93 using Tapatalk

Sorry if I'm being clueless here, but what's the "good laugh" part?

Do tell.  Where or what is the "irony"?  Do you know the actual meaning of "irony"?

 

AJ

Define Irony:

Sprint's stock price dropped sharply but it seems as though it's climbing back up slowly again. We'll have to see how it performs over the next week or so.

Sprint has its Fiscal 2016 First Quarter Earnings Conference Call on July 25th. I'm sure this SoftBank transaction will come up in the Q&A.

I wonder if SoftBank engineers will get a peak at ARM's upcoming design architecture... Talk about a competitive advantage.

It's double entry bookkeeping. Softbank gives Sprint money, you debit cash and credit... owners equity. I don't believe Softbank can own a larger stake in Sprint without taking it private and possibly running afoul of regulators.

 

Sent from my Samsung Galaxy S7

The original merger prospectus has a provision which outlines what SoftBank would have to pay for the remaining Sprint shares if its ownership stake in Sprint exceeds 85%:

Mandatory Offer to Purchase. The New Sprint certificate of incorporation as in effect at the effective time of the SoftBank Merger will provide that, in the event that the combined voting interest of SoftBank and its controlled affiliates in New Sprint exceeds 85% of the outstanding voting securities of New Sprint, then SoftBank or a controlled affiliate will make an offer to acquire all the remaining shares of New Sprint common stock at a price not less than the volume-weighted average closing price of New Sprint common stock for the 20 consecutive trading days immediately preceding such offer.

You're looking at it through the goggles of a Sprint user and someone who wants Sprint to succeed. 

 

To Softbank executives and bean counters Sprint is a liability that they can't get rid of. Once you see that you'll see why Son and softbank doesn't heavily invest into it and why they've been so quiet. 

That's a good point. Indeed I am.

So what's Sprint supposed to do? Go barebones for the foreseeable future until it either merges with T-Mobile, gets bought out by someone else, or declares bankruptcy?

Where's Sprint left standing once the network densification project is completed?

Yeah. Diversification and return to capital. Even if you zero out spring's debt there is a real question if Sprint will ever make Softbank a return on 53 billion or so of investment.

 

Sent from my LGLS992 using Tapatalk

It's all a matter of how much upside you see when you look at Sprint. Either it will win back millions of customers from the other carriers or it won't.

Eliminating Sprint's debt entirely would put Sprint on an extremely competitive footing vs its competition for all kinds of initiatives: Spectrum, Network Expansion, etc. Heck, eliminating half of it would make a huge difference in terms of Sprint's free cash flow.

Perhaps Son sees more upside with ARM than having Sprint become the #1 wireless carrier.

Arm is somewhat a profitable entity with a good positive reputation. Sprint...eh not so much.

 

Remember Softbank did try to sell Sprint and would have if there were any takers (there are none). 

True. However, Sprint would be very profitable if it didn't have to make these massive interest payments on its debt (in addition to the cost cutting/waste reduction which has already been done).

^to put in American dollar terms:

 

SoftBank will buy U.K.-based chip designer ARM Holdings in an all-cash deal valued at more than $32 billion.

 

http://on.wsj.com/2a2ru6G

That's quite a bit of coin!

Meanwhile, Sprint has had to resort to multiple leasing vehicles to generate free cash and offload debt from the balance sheet.

For this amount of money:

Son could have just about paid off Sprint's debt (~$33 Billion), leaving it free and clear; or

Son could have bought out the remaining shares of Sprint stock and take the company private; or

Or Son could have gotten Sprint a substantial chunk of nationwide 600 MHz spectrum in the current auction.

etc....

Am I missing something here?

That is an ignorant thing to say on at least two counts.  First, 3 dBm is 2 mW.  So, that is something.  But, second, that is not what you actually intend.  You really mean 3 dB, not 3 dBm.  And you still think that 3 dB is "nothing"?  Is the difference between two scoops of ice cream and four scoops of ice cream "nothing"?  Is the difference between $100 and $200 "nothing"?  Is the difference between 60 mph and 120 mph "nothing"?  Those are all 3 dB differences.

 

AJ

When Paul is in the new "man on the street" commercial, he says Sprint's reliability is now within 1% of Verizon, based on recent data from Nielsen. How big/comparable is this difference relative to your statements about dB?

Meanwhile, in large parts of the Metro system in Washington DC, Verizon (and all the other carriers) still lack LTE.  I think the completion date for that is like 2020 or something now.  And given Metro's record, I won't expect to see it before 2025.

 

- Trip

Check out the WMATA Reports here: http://www.wmata.com/about_metro/general_manager/gm_plan.cfm

Customer Accountability Report (http://www.wmata.com/about_metro/general_manager/performance/CARe.pdf?) dated June 30th, item #4:

 

Actions: Publish schedule detailing when tunnel segments are activated for telecom providers to offer cell service

 

Status: Issue activation plan to public summer 2016.

 

So we'll see.

I would hate to see what happens when the battery dies on the flying COW.  Another Chick-Fil-A commercial of COW's falling from the sky? 

Would a Goodyear Blimp be a better solution for a flying COW?