The Wall Street Journal is stirring up debate among wireless industry watchers with an article that suggests Sprint is struggling to keep up the pace in the spectrum marathon. Miriam Gottfried, author of the article published Sunday, calls Sprint the "odd man out" in the battle for wireless spectrum.
Gottfried makes a quick comparison: Sprint has launched LTE in 15 markets and expects to have nationwide coverage by the end of 2013. By contrast, Verizon has launched LTE in 330 markets and AT&T in 47. She also points to Janco Partners research that said Sprint's initial LTE offering will occupy a much smaller channel than its competitors' -- and that could limit network capacity.
"Sprint's position is that with far fewer subscribers than AT&T and Verizon Wireless, it needs less spectrum," Gottfried writes. "But that's the rub. Sprint's financial position is deteriorating. It lost 192,000 post-paid subscribers in the first quarter and reported a loss of $863 million."
Sprint's Data Challenges
Weston Henderek, a principal analyst at Current Analysis, said Sprint had clear spectrum challenges but the company could overcome them if it was able to execute on its Network Vision strategy. The strategy blends WiMax, Nextel's 2G IDEN technology and CDMA on the pathway to LTE.
"Sprint just now launched LTE. They said it was rolled out in 15 markets, but it was really just five major markets and the rest of the markets were submarkets around those five major markets," Henderek said. "So Sprint's LTE launch sounds more impressive than it is right now. Sprint is a little late to the table with LTE as compared to Verizon Wireless and even AT&T."
Despite the slower rollout, Sprint is billing itself as the only carrier with true unlimited data . But Henderek said Sprint's ability to deliver unlimited data is on a smaller slice of the LTE network than what AT&T and Verizon have, which could ultimately cause new challenges as data usage continues to explode.
A Difficult Puzzle
At the same time, Sprint is working to raise cash in order to complete its Network Vision and has also made a multibillion-dollar commitment to Apple on the iPhone front. Henderek compared Sprint's challenge to putting together a difficult puzzle. Every piece has to be in place in order for Sprint to see the picture for which it hopes.
It all comes back to executing the vision. As Sprint continues rolling out its LTE network, the wireless carrier is clearly not able to offer as much capacity as its larger competitors -- and there are still clear barriers to offering more capacity, from spectrum shortages to combining its legacy networks.
"If people are using too much data that could cause a bad user experience and people could start defecting from the carrier in droves. It's a balancing act," Henderek said. "Sprint has to take advantage of the marketing that this unlimited data gives them but at the same time they have to be very aware of where their network stands and being able to deliver a good service."
Posted: 2012-07-24 @ 11:15pm PT
There is a lot more going on here than this article points out. Today, yes Sprint has only 10 Mhz to work with. Verizon has an average 30 MHZ. (Assuming 10 Mhz chunks.) By 2014 Sprint will have 20 Mhz (10 Mhz in 800 from Nextel) and may be able to dynamically re-farm some more of that 1.9 spectrum for a total of 30 mhz. That's the point of NV is dynamic allocation. Also note that Sprint will use almost twice the number of towers and only has half the subscribers. With LTE you get capacity or speed, but not both.