Why Sprint wants to add postpaid phone connections



Sprint continues to lose subscribers at a rapid pace

Sprint (S) lost 272,000 postpaid net connections in the last quarter. More importantly, Sprint lost 500,000 postpaid phone net connections since it gained some postpaid tablet net connections. Overall, Sprint lost 1.8 million postpaid phone net connections in the first nine months this year. This is more than the 1.3 million connections that it lost in 2013.

Losing postpaid phone subscribers is a big loss for Sprint. Postpaid phone subscribers drive profitability. Management mentioned the loss during the conference call to announce earnings. Incidentally, smartphones are driving net subscriber growth at AT&T.

To get an idea about the extent of Sprint’s loss, Verizon (VZ), AT&T (T), and T-Mobile (TMUS) all gained net postpaid phone subscribers in the last quarter. The most surprising aspect came from T-Mobile. It gained the maximum number of postpaid phone net connections in excess of one million.

Telecom postpaid phone subscribers gain

iPhone 6 launch helped Sprint come out of August lows

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There are a number of reasons why subscribers keep leaving Sprint’s network. Earlier in this series, we discussed some of the reasons including lower customer satisfaction levels and the worst network performance. Management mentioned that in August, its share of postpaid gross additions fell to less than 10%.

However, things started to change in September and October. Earlier in this series, we discussed how Apple’s (AAPL) iPhone 6 launch instilled life into Sprint. The number of postpaid gross additions increased by 40% sequentially in September. Now, Sprint hopes that it will be able to achieve its target of a positive net postpaid phone connections soon.


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