Subscribe / Unsubscribe Enewsletters | Login | Register

Pencil Banner

Sprint sees record low customer loss rate, but drops to 4th place behind T-Mobile

Matt Hamblen | Aug. 5, 2015
Sprint announced on Tuesday its lowest rate of postpaid customer losses in its history, even as the company officially dropped a notch to fourth place, behind T-Mobile, among U.S. wireless carriers.

softbank chairman masayoshi son
SoftBank Group Corp. Chairman and CEO Masayoshi Son speaks during the SoftBank World 2015 event in Tokyo on July 30, 2015. Softbank owns 78 percent of Sprint.  Credit: Yuya Shino/Reuters

Sprint announced on Tuesday its lowest rate of postpaid customer losses in its history, even as the company officially dropped a notch to fourth place, behind T-Mobile, among U.S. wireless carriers.

Sprint recorded 57.688 million customers and connections in its earnings report for the first quarter that ended June 30, just behind T-Mobile's 58.9 million

Sprint and analysts view the fourth-place ranking as irrelevant. They pointed to recent improvements in Sprint's network connections and speeds, judged by various third parties, as a key factor in lowering the record low postpaid customer churn (loss) rate to just 1.56 percent.

CEO Marcelo Claure pointed to the low churn rate and net adds of 310,000 postpaid customers for the first time in two years as important signs that Sprint "is on the pathway to growth."

"I agree with Sprint that consumers do not care who is fourth or third. Sprint's network is finally improving, which is about time," said Roger Entner, an analyst at Recon Analytics.

Entner said Sprint is showing a record low churn at the same time that other carriers are showing lowered rates. "It looks like consumers are happier with the choices that they have made."

One factor in lowering the churn rate could be that Sprint and other carriers are tightening requirements on the credit they extend to customers, analysts said, but Sprint didn't confirm that tightening is happening.

Sprint's network improvements and overall financial progress got a ringing endorsement from Masayoshi Son, chairman and CEO of Japan's Softbank Group, which owns 78 percent of Sprint.

"I am extremely excited about the turnaround of Sprint," Son said on the earnings call. He said he personally has worked nearly every night from 10 p.m. to 2 a.m. in Japan with SoftBank and Sprint engineers to find the best way to implement better coverage using Sprint's network holdings. Sprint has used big data insights to best focus its network elements to achieve maximum speed and network coverage.

"I don't want to sell the company," Son added. "Sprint is going to be a very, very good company for which I'll be very proud."

Son also chided U.S. wireless networks generally, compared to those in Japan, calling all four major networks "very bad" and "not something you should be proud of." He made the comment in reference to a question about how Sprint will react to plans by AT&T and Verizon Wireless, the two top U.S. carriers,  to expand the ability to use video over wireless.

 

1  2  Next Page 

Sign up for CIO Asia eNewsletters.