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  (Source: Into Mobile/AP)
Sprint hopes for big boost from iPhone, but may be hit by tethering defectors

Sprint Nextel Corp. (S), America's third largest carrier, had some good news to report today with its latest earnings report.

The company reports that in the third calendar quarter of 2011, it earned $8.3B USD in net revenue and $1.3B USD in adjusted operating income before depreciation and amortization (OIBDA).

Sprint has reached its highest subscriber totals in the last five years, driven by 1.3 million new subscribers in the quarter --with 304,000 new standard (post-paid) subscribers, 485,000 new prepaid subscribers, and 835,000 affiliate (e.g. business) subscribers.

The company did all of this without the Apple, Inc.'s (AAPL) iPhone, which is now on Sprint’s network.  The company writes:

Growth in Sprint brand net additions was achieved without the benefit of Apple’s iPhone 4S and iPhone 4, which launched Oct. 14. The launch of this iconic device resulted in Sprint’s best ever day of sales in retail, web and telesales for a device family in Sprint history. The response to this device by current and new customers has surpassed initial expectations. The iPhone is expected to be accretive for Sprint, and iPhone users are expected to be among Sprint’s most profitable customers.

Still, the outlook for the company isn't altogether rosy.  The company reported a net loss of $301M USD for the quarter.

Adding to the negative side of the picture, the firm recent killed unlimited data on its tethered and tablet connections, and forum traffic indicates that some customers are already cancelling their tethering service.  With smartphone data potentially on the chopping block next, it remains to be seen how much more Sprint subscribers will put up with.

Also we recently raised concerns about how Sprint is allowing text message frauders to victimize its customers, happily billing customers' plans without their approval and reportedly pocketing a cut of the revenue from the fraud scheme.

These concerns aren't enough to entirely outshine the positive movement at Sprint, but they do give cause to pause when considering a move to Sprint’s network.

Source: Sprint





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