Sprint Nextel continues to lose iDEN customers
Sprint Nextel lost more than 700,000 traditional iDEN customers while registering a $211 million loss during the first quarter, offsetting growth in other sectors of the wireless carrier’s business, corporate officials said today during the company’s earnings conference call.
During the first quarter, the carrier lost 1.1 million prepaid iDEN customers, but about one-third of those users migrated to the company’s CDMA or PowerSource—using a dual-mode phone that leverages both the iDEN and CDMA networks—packages, Sprint Nextel Chief Financial Paul Saleh said during the call.
Sprint Nextel CEO Gary Forsee attributed the iDEN customer losses to “lingering network-perceptions issues” but said the carrier’s recent investments in the iDEN system has the system running at “an all-time best” level.
In January, Sprint Nextel projected a difficult 2007, and many of the first-quarter numbers remained in line with that guidance.
The carrier reiterated its belief that it will spend $800 million this year to pay for reconfiguration of the 800 MHz band to reduce interference to public-safety licensees. Exactly how much Sprint Nextel spent on rebanding during the first quarter was not available for this story, but Forsee said the amount was relatively small as the carrier continues to work with public-safety licensees to plan for the retunes, which are expected to begin in earnest later this year.
“We expect spending [on 800 MHz rebanding] to increase during the second half of this year,” Forsee said.
With the decline of iDEN customers overshadowing gains on its CDMA network, Sprint Nextel reported an overall loss of 220 million post-paid subscribers. The iDEN network saw an increase of 275,000 prepaid Boost Mobile subscribers during the quarter.
By the end of the year, Sprint Nextel expects to have 2 million to 3 million PowerSource users, Forsee said.
In terms of future services, Forsee said tests for the QChat push-to-talk service that will be offered over the CDMA network are “right on track,” meeting the carrier’s standard of DirectConnect push-to-talk latency performance. QChat field demonstrations will begin this summer, he said.
Forsee said Sprint Nextel will detail its WiMAX deployment strategy by the fall, but the CEO offered some insight into the availability of devices that will be able to access the new broadband network. The carrier expects WiMAX cards for laptops to be available late this year, handsets to be available in the middle of 2008 and devices with embedded WiMAX connectivity to be on the market in 2009.
