Sprint CEO: iPhone users are more loyal, use less data

Jordan Kahn

Reports from the Wall Street Journal last October revealed Sprint’s Chief Executive Officer Dan Hesse convinced the company’s board to take on a staggering commitment of approximately $20 billion to purchase 30.5 million iPhones over four years. At the time, Hesse said Sprint “would likely lose money on the deal until 2014. ″ He also claimed not having the iPhone was “the No. 1 reason customers leave or switch.” In an interview with Mobile World Live (via BGR), Hesse defended the decision and claimed, among other things, that iPhone users are “more profitable than the average smartphone customer.”

“ Subsidies are heavy for the iPhone. This is the reason why a high percentage of new customers is important… But iPhone customers have a lower level of churn and they actually use less data on average than a high-end 4G Android device. So from a cost point of view and a customer lifetime value perspective. They’re more profitable than the average smartphone customer.”

Hesse went on to claim that Sprint was “pulling a lot of customers” from AT&T and Verizon during the fourth quarter by noting four out of every 10 iPhones the carrier sold were new customers. According to Hesse, that is around double the rate of the other carriers.
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40 percent of Sprint’s 1.8M iPhone sales last quarter were to new customers

9to5 Staff

United States carrier Sprint, the nation’s third-largest wireless telecommunications network, announced today holiday quarter earnings containing a couple interesting tidbits related to Apple’s iPhone, which helped bring in most of its new customers. Sprint reportedly ponied up $20 billion to land Apple’s iconic smartphone last October, calling the handset launch in today’s statement “successful.”

Forty percent of Sprint’s 1.8 million iPhone sales in the fourth quarter were to new customers. 

This means some 720,000 Sprint iPhones went into the hands of new customers—once again highlighting Apple device’s proven ability to attract new consumers. Sprint only added 539,000 net additions to the postpaid base, so it would likely have lost around 200,000 customers without the iPhone in its lineup.

According to Sprint’s internal estimates, high costs associated with subsidizing the iPhone —combined with the impact of iPhone and Network Vision costs— are to blame for wider than expected short term loss, which reached an astounding $1.3 billion in Q4 2011 and $2.9 billion for 2011. These factors also reduced fourth-quarter adjusted operating income before depreciation and amortization (OIBDA) of $842 million by approximately $684 million.

Reuters reported in October 2011 that Sprint paid about 40 percent higher subsidy to Apple than the industry average, amounting to $200 more per device.

Sprint CEO Dan Hesse has some nice words for Apple’s phone:

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AT&T introducing new data plans for phones and tablets Jan. 22

Jake Smith

AT&T announced it would introduce new data plans for phones and tablets on Sunday, Jan. 22.  There will be three phone plans: $20 for 300MB, $30 for 3GB, and $50 for 5GB with tethering. While the two tablet plans will be: $30 for 3GB and $50 for 5GB.

In the past, AT&T made available $15 for 200MB, $25 for 2GB, or $45 for 4GB with tethering. Each plan earned more data and a $5 price hike. AT&T will charge $10 for each 1GB roll over. AT&T explained the sudden change:

“Customers are using more data than ever before,” said David Christopher, chief marketing officer, AT&T Mobility and Consumer Markets. “Our new plans are driven by this increasing demand in a highly competitive environment, and continue to deliver a great value to customers, especially as we continue our 4G LTE deployment.”

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Verizon Wireless sold 4.2M iPhones during the holiday quarter, doubling the previous

Jake Smith

Verizon Wireless’ Chief Financial Officer Fran Shammo told attendees at a conference today that Verizon sold a total 4.2 million iPhones during the holiday quarter, according to Bloomberg. Interestingly, the numbers reported by Shammo show that Verizon more than doubled iPhone sales from the previous quarter, where they sold 2 million. This sales hike was likely helped by pent up demand for the iPhone 4S, a cheaper iPhone 4, and the influx of shoppers during the holidays.  Verizon’s previous iPhone sales were said by some to be a disappointment.

Apple’s fiscal Q1 earnings call is coming up on Jan. 24, where we will hear the total number of iPhones sold during the holiday quarter. We will also hear specific numbers from Sprint and AT&T in the coming weeks. Last quarter’s total amount of iPhones sold should blow out any previous quarters with some experts putting estimates as high as 35 million.

Radio Shack to offer $30 discount on iPhone 4S and iPhone 4 starting Sunday

Jake Smith

From 9to5Toys.com:

RadioShack is offering a $30 discount on all of their AT&T high end smartphones which obviously includes the iPhone 4S and iPhone 4, starting Sunday and running until December 17th. The sale will bring the iPhone 4S 16GB down to $170 0n contract and the iPhone 4 16GB to $70 on contract. Also, if you use Radioshack’s trade-in program you can get the phones for free and even have some extra credit left over. Head over to your local store to take advantage of this sale.

Update: Word on the street is that Target is going to give $25 back on an iPhone purchase. (Thanks commenter)

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Sprint posts new iPhone 4S ad, making its way to RadioShack this weekend, 16GB only

9to5Mac

If you’re still trying to get your hands on the Sprint iPhone 4S, you’ve now got another outlet. According to internal documents we’ve obtained, RadioShack will be adding Apple’s latest handset to their Sprint lineup this weekend. Some stores should have stock now and many more will be getting it over the coming days. Unfortunately, if you want the 32 or 64 GB models, you may be out of luck, at least for now. According the documents we’ve seen, there is no indication that those models will be available at this time at Radio Shack.

The 16 GB model will be available in both black and white, and will be available at all stores that currently carry the iPhone, and stores that don’t typically carry the iPhone should be able to order it in. RadioShack has carried the iPhone 4 on Sprint since they started selling the 4S on Verizon and AT&T last month with a note that the Sprint 4S would be available at a later date, due to inventory issues.

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