Better network performance, better customer experience
In the previous part of this series, we saw that Sprint (S) has bagged significantly more RootMetrics awards for metro markets in 1H15 than it did in 1H14. We also saw that network enhancements and capacity additions across spectrum bands have helped improve the company’s network performance in metro markets.
Improved network performance enhances customer experience and helps manage customer attrition in a saturated US wireless telecom (telecommunications) space. Improved network performance is particularly significant for Sprint considering its high customer attrition rates.
Sprint has worst postpaid churn among US wireless carriers
As you can see in the above graph, the Sprint platform’s postpaid churn rate went down in 4Q14, the company’s last reported quarter. According to Sprint, improvement in quarter-over-quarter voluntary churn in 4Q14 was the best in about 11 years.
Despite these positive results, Sprint’s postpaid churn remained the worst among the largest national wireless carriers. In the United States, the largest four wireless carrier by subscribers are Verizon (VZ), AT&T (T), T-Mobile (TMUS), and Sprint (S). In the last reported quarter, AT&T had the best churn rate of 1.02%. Verizon followed closely with a postpaid churn rate of ~1.03% during the period. T-Mobile’s postpaid phone churn of ~1.3% was also lower than Sprint’s.
You may want to consider taking a diversified exposure in Sprint by investing in the iShares MSCI ACWI ETF (ACWI). ACWI held ~0.01% in Sprint as of June 30, 2015. You can also invest in the iShares Russell 1000 ETF (IWB), which held ~0.02% in Sprint on the same date.