Monday, October 3, 2011 at 3:10 pm.
Hey, Sprint customers, hope you like iPhones
The WSJ reports that Sprint is basically betting the company on Apple:
[Sprint CEO Dan] Hesse told the board the carrier would have to agree to purchase at least 30.5 million iPhones over the next four years—a commitment of $20 billion at current rates—whether or not it could find people to buy them, according to people familiar with the matter.
Can Sprint sell 30+ million iPhones in 4 years? (That’s about 8 million per year.) Probably, but it will require some work. Basically, it means that Sprint will have to make the iPhone its smartphone of choice. (Bad news for Google, Samsung, HTC, etc.)
Sprint has about 50 million subs, but many are on prepaid plans or belong to the Nextel walkie-talkie network. Any Sprint customer that wants a smartphone will probably be directed toward the iPhone. And Sprint will have to try to grow for the first time in a long time by stealing customers away from other carriers. Unlimited data access seems to be the big plan, and I’m not sure if that’s going to be very effective. Sprint may have to do more.
One detail the WSJ doesn’t include, but BGR reports half-heartedly, is that Apple may be giving Sprint an exclusive on the iPhone 5, to be powered by Sprint’s 4G WiMax network. Anything’s possible, but this seems off. Sprint itself is trying to run away from WiMax and use LTE as its 4G network going forward, and the rest of the world is skipping WiMax for LTE. Why would Apple waste all that time on a dying format? It doesn’t make sense.
My guess is: Sprint gets the same iPhone that everyone else does tomorrow, and next year, the same LTE iPhone that everyone else gets.