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Sprint Subscriber Gains Hit 4-Year High

Overland Park, Kan. –


posted its second consecutive
quarterly gain in net new wireless subscribers following three years of

Despite the gains, Sprint’s wireless
operations posted a third-quarter operating loss of $345 million, although the
loss was down from the year-ago $448 million. For the year to date, wireless
operating losses shrank to $962 million from a year-ago $1.32 billion.

Sprint’s subscriber gains lagged

third-quarter gain of 2.6 million and Verizon Wireless’s 997,000.

All figures
include sales through resellers but exclude connected devices such as
e-readers, tablets and in-vehicle telematics systems with embedded cellular.

Sprint’s third quarter’s gain of
644,000 net new subscribers combines figures from Sprint’s CDMA and iDEN
networks. The gain also combines a gain of 280,000 subscribers obtained through
resellers and affiliated carriers with a gain of 364,000 “retail” subscribers,
or subscribers acquired by Sprint and its authorized dealers.

Here’s how each wireless segment did:

Retail postpaid subscribers:

For the quarter, the retail postpaid
subscriber base on Sprint’s CDMA and iDEN networks shrank by 107,000, down from
a year-ago loss of 801,000 subscribers. Shrinkage for the year-to-date slowed
to 913,000 from a year-ago loss of 3.04 million subs.

 The company attributed the decline to
defections from its 2G iDEN network and noted that the number of Sprint-brand
retail-postpaid subscribers on its CDMA network grew by 354,000. That gain was
offset by iDEN declines of 383,000 and Power Source-brand declines of 78,000.
Power Source phones incorporate CDMA and iDEN technology. Sprint CEO Dan Hesse
noted that the company “is spending very little” to sign up new customers for
its iDEN network and is focusing on iDEN churn reduction.

Retail prepaid subscribers:

The number of net new retail prepaid
subs on the CDMA and iDEN networks rose to a combined 471,000 from a year-ago
gain of 173,000. For the quarter, the number of prepaid iDEN subscribers fell
by 700,000, offset by a gain of 1.2 million CDMA-network subs. For the
year-to-date, net new subscribers fell to 992,000 from a year-ago gain of 2.12

Reseller, affiliate subscribers:

Net ads, consisting of prepaid and
postpaid subs, were up 280,000 compared to a year-ago decline of 410,000. For
the year-to-date, net adds rose to 601,000 from a year-ago decline of 59,000.

At the end of the third quarter,
Sprint’s wireless subscriber base came to 48.8 million behind AT&T’s 92.8
million customers and Verizon’s 93.2 million. Those numbers include sales
through resellers but exclude embedded cellular connections in products such as
e-readers, in-vehicle telematics equipment, fleet-management systems, and the

In consolidating its wireless and
wireline results, Sprint said its overall third-quarter operating loss fell to
$213 million from a year-ago $254 million and for the year-to-date to $456
million from $854 million. The company’s consolidated net loss, however, rose
to $911 million from a year-ago $478 million and were up for the year-to-date
to $2.54 billion from $1.46 billion.

One way to trim those losses,
said CEO Dan Hesse, is by combining Sprint’s separate 1,900MHz CDMA and
800/900MHz iDEN networks into one platform in which both wireless formats will
share the same cell sites, bands, and backhaul. Significant benefits from the
planner merger won’t occur, however, until 2012, the company said.

As it combines networks, Sprint
will apportion part of the iDEN network’s 800MHz spectrum for CDMA use to
improve CDMA call quality and in-building penetration. Given that iDEN operates
in the lower portions of the 800MHz band, he noted, today’s 800/1,900MHz CDMA
phones would have to be tweaked to operate on a dual-band Sprint CDMA network.

In other
comments, Hesse noted that Sprint continues to evaluate tiered data-plan
pricing. The carrier offers unlimited-use plans as part of a strategy to offer
a reduced number of simplified rate plans. Hesse said people are willing to pay
a premium for the simplicity of unlimited plans, but he noted that “no one
wants to lose segments of the market.”