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Print 18 comment(s) - last by semiconshawn.. on May 17 at 8:31 AM

Apple is sure to see a much greater benefit from this iPhone relationship than Sprint

Apple's iPhone is a huge seller both worldwide and in the United States. At first, the smartphone was exclusive to AT&T's wireless networks in the U.S. Just over a year ago, Verizon jumped onboard. And with the launch of the iPhone 4S, Sprint was finally able to provide Apple's popular smartphone to its customers.
 
When the deal was first announced, it was reported that Sprint would purchase 30.5 million iPhone over the course of four years (at a cost of $15.5 billion USD). It was also reported that Sprint wouldn't make any money on the arrangement with Apple until at least 2014.
 
Fast-forward to today, and Sprint CEO Dan Hesse is now pushing back that profitability date until 2015. Hesse still stands by his assertion that "carrying the iPhone will be quite profitable;" shareholders are just going to have to wait a bit longer than they originally envisioned.


[Source: TechnoBuffalo]
 
For anyone that questions Hesse's decision to make a deal with Apple, he simply tells them to take a look at embattled T-Mobile. T-Mobile recently announced that it would be laying off an additional 900 workers in the U.S. and has lost contract customers for 10 straight quarters.
 
T-Mobile is also the only one of America's "Big 4" wireless carriers that doesn't have the iPhone.
 
In other Sprint news, TechnoBuffalo has learned that the wireless carrier will end early upgrades for customers effective June 1. The program allowed customers to upgrade to a new phone within 10 to 14 days of their originally scheduled upgrade date.
 
Granted, waiting an extra two weeks isn't going to be a deal breaker for most people, so we doubt that many Sprint customers will cry themselves to sleep over this move.

Sources: Market Watch, Bloomberg, TechnoBuffalo



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Profits are always 12-18 months away
By tayb on 5/16/2012 2:45:35 PM , Rating: 5
Profits from the iPhone are always 12-18 months away. Carriers eat so much of the upfront costs to get the phone to $200 that it takes them 12-18 months to recoup the costs and start profiting. Just as they are about to enter the black the customer comes back in and upgrades and the process starts over again. This is exactly why we have upgrade fees, huge early termination fees, increased usage charges, and the end of unlimited data. I loathe carriers so it makes me happy to hear they aren't printing money.




RE: Profits are always 12-18 months away
By Ticholo on 5/16/2012 3:10:04 PM , Rating: 2
You should correct that to "... they aren't printing money yet ."
They will... in 12 months...


RE: Profits are always 12-18 months away
By michael2k on 5/16/2012 3:44:35 PM , Rating: 2
Until the newest iPhone comes out with <X> feature that removes a profit stream, ala iMessage or FaceTime or AppStore or Find my iPhone or whatever.


RE: Profits are always 12-18 months away
By Samus on 5/16/12, Rating: 0
RE: Profits are always 12-18 months away
By sprockkets on 5/16/2012 5:58:15 PM , Rating: 2
Yeah, but wimax is dead and not getting any bigger or better.

And for anecdotal evidence, everytime I have no data coverage for sprint (for work), I have coverage for tmobile.

Oh well, get what works for you.


By semiconshawn on 5/17/2012 8:31:16 AM , Rating: 3
Arguing about which is better Sprint or Tmob is like asking if you want the head or the claw of the hammer to your face.


By name99 on 5/16/2012 8:45:33 PM , Rating: 2
"Carriers eat so much of the upfront costs to get the phone to $200 that it takes them 12-18 months to recoup the costs and start profiting. Just as they are about to enter the black the customer comes back in and upgrades and the process starts over again. "

Boo hoo, poor carriers. They COULD, of course, ALSO provide the option that I
- buy the phone at full price
- get a month to month (no two-year) contract AND
- the phone is not carrier locked.

Given that they're unwilling to do this, it's a little hard for me to weep about how much difficulty they're having with their business plan of choice.

The HONEST truth here is that Sprint has made a long series of crappy decisions, from WiMax to getting in bed with the snakes at LightSquared to passing on the original iPhone. Dan Hesse wants to blame Apple because Apple are a convenient target --- but Apple have buggerall to do with his current problems.

To take just one example of Sprint's never-ending incompetence --- if I get an iPhone on Sprint, does it come with unlocked GSM? As far as I know, no it does not. WTF not? Why doesn't Sprint just do this automatically and advertise it as a special Sprint feature --- buy OUR iPhone and, out the box, you can use it anywhere in the world?
This is precisely Sprint's problem --- they have this iPhone commitment now, but they can't decide if they want iPhone to be successful or not. God forbid that they actually consider the question of "what would increase customer satisfaction --- that's completely off their radar".


"We shipped it on Saturday. Then on Sunday, we rested." -- Steve Jobs on the iPad launch














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