Sprint announced back in August that it would be hosting a “Strategy Update” meeting today, and the uncommon phrasing set our imaginations aflutter. Will it be about the iPhone? Well, we already know Sprint will carry both the iPhone and iPhone 4S beginning the 14th, but Sprint has been eerily quiet about finally procuring the world’s most popular smartphone so we wouldn’t be surprised to hear more about it today. There’s also a supposed $20 billion deal with Apple that the company inked recently, so perhaps we’ll hear about that. Will Sprint elaborate on its 4G plans? The carrier said in July that it worked out a deal with LightSquared to adopt 4G LTE, but LightSquared is having issues lately and again, Sprint has been awfully quiet lately. We’re just minutes away from getting the skinny straight from the horse’s mouth, so hit the break for our live coverage of Sprint’s press conference, which is scheduled to begin at 9:30 a.m. Eastern, and don’t forget to refresh the page for all the latest updates.
12:05PM:Ok guys thank you for joining us today, the Q&A session is wrapping up in just a few minutes.
12:04PM:Question: What is your commitment to Android, now that you’ve made this bet with Apple? “We want to be very clear. Although we’re very excited about our announcement with Apple. We’re not just going to forget our other partners. Android is just as popular, if not growing faster around the world.” Those partnerships don’t go away, we continue to sell products that fill a whole portfolio of needs. We’re good partners with all of those partners.
11:55AM:Question for Dan: There was a rumor that you made a significant financial investment with regard to the iPhone (20 billion, according to the WSJ). True? Dan: No comment. (duh)
11:52AM:“We have nothing beyond 2012 to announce with regard to Clearwire,” Dan Hesse said.
11:51AM:Dan was asked what happens with Clearwire moving forward: We will continue to sell additional WiMAX devices through the end of 2012. Supporting, one could expect, to be much longer than that.
11:48AM:Everyone’s on stage now and fielding questions. We’ll cover anything big but it looks like we’re pretty much done here.
11:44AM:“The iPhone will provide better subscriber growth and churn.”
11:44AM:“To Joe: I’d be lying if I said I followed along with what was going on in those slides. It’s unclear to me what the iPhone impact,” is.
11:43AM:Sprint’s management team is taking the stage.
11:43AM:Sorry, Q&A is starting now.
11:42AM:Q&A will beginning now.
11:41AM:(That last slide does not include impact from the iPhone ^ze)
11:36AM:We see continued momentum and postpaid adds.
11:36AM:We are now solidly reporting subscriber growth in our over retail net adds.
11:35AM:“We have a big advantage with our unlimited plans. Now we can exceed our expectations.”
11:34AM:We’re going over some in-depth financial details and we’re working on posting images.
11:32AM:An integral part of Sprint Vision is the 10-11B estimated savings over the next few years through 2017. The savings come from rolling out 4G LTE on Sprint’s own spectrum and the modernization of its 3G network. That drives about $7 billion of financial benefit. $4 billion in savings from having to no longer maintain the iDEN network.
11:30AM:Sprint’s capital spend is in-line with the industry.
11:29AM:Network Vision is about investing in growth technology to drive overall subscriber growth. Sprint Direct Connect, enhanced 3G and 4G LTE. We’ve been criticized for underspending, but this isn’t true. We did not need to make the additional investment after rolling out 3G. We invested in 4G with Clearwire. We would have spent that money anyway but we wanted to be first to market with 4G.
11:27AM:Sprint is continuing to explore additional spectrum opportunities as it moves forward.
11:27AM:Sprint thinks the iPhone launch will help level the playing field with its largest competitors. Sprint can finally answer “yes” when customers ask if it carries the iPhone in shops.
11:23AM:Joe Euteneuer, Sprint’s CFO is taking the stage.
11:23AM:“Without all of these different partners really investing in the R&D it takes to deliver these products to market, a lot of this wouldn’t be possible. It requires a lot of technology to cram in all the support whether it’s the CDMA tech, WiMAX or LTE tech. It’s a serious investment for all of these companies to say they will come out and support our strategy.”
11:22AM:Sanjay Jha, chairman and CEO of Motorola Mobility is speaking in a brief video clip. He’s discussing the Motorola Photon 4G and other Motorola 4G WiMAX devices. He said he’s looking forward to launching the first push-to-talk CDMA device (smartphone, since Kyocera already has a basic phone) later this year. He has made a significant investment in LTE and looks forward to delivering devices in the future.
11:19AM:We’re seeing a video of his speech. he’s discussing how Qualcomm has worked with Sprint on its transition and how it’s working on Qualcomm Snapdragon processors with 3G and LTE capabilities for Sprint. “We believe Sprint’s vision will be highly successful. We continue to work together to be on the forefront of wireless technologies.”
11:18AM:Qualcomm’s EVP and Group President QCT Stephen Mollenkopf is going to take the stage now to give a testimonial as a partner with Sprint on the handset space.
11:17AM:“We can expand that to “Push to X” to integrate the services into other services such as Facebook, rich messaging, the address book within the phone.” Sounds like you’ll be able to talk to different apps and services, but Sprint wasn’t very clear on what Push to X meant.
11:16AM:One of the things we’ll be able to do for the first time by the end of this year is provide an app for push-to-talk for casual usage. It will be available for a lot larger base of customers than what you see today.
11:15AM:Network Vision will make push-to-talk more ubiquitous. Broader coverage for iDEN footprint, better product offering including smartphones, rugged devices, and a downloadable Sprint Direct Connect app for Android devices.
11:14AM:15 devices will be coming in 2012 including tablets, smartphones and data cards. These will be on par with the same quality you’ve seen us deliver to date.
11:13AM:We will deliver dual-mode CDMA/LTE products by the first half of 2012 (handsets specifically!). Tablets as well, smartphones, high-tier iconic devices and mid-tier products. We’re very excited about all of the partners in the ecosystem we’ll be able to attract.
11:12AM:Displays, processors also add to the costs. But, you will see we’ll be able to do with LTE with what we’ve done with WiMAX today. Products at all price points based on chipsets and technologies. We’ve continued to ride the cost curves of the WiMAX radio and the cost curves around that. WiMAX continues to be an important part of our product strategy and we will continue to provide products to our customers. We don’t want to over simplify how customers make decisions and will provide them multiple products with multiple technologies.
11:10AM:What costs more? LTE or WiMAX? Typically there’s a cost curve with any new technology. As we roll out LTE we’re catching it at the right cost curve with second and third generation LTE radios such as Qualcomm’s 8960. It’s not only an application processor but it supports multiple bands for multiple carriers, including our 1900MHz band A-F and G. It’s at a time when we’re seeing the cost curve crossing over what we see from 3rd and 4th generation WiMAX chips.
11:09AM:From an LTE roadmap standpoint, every OEM we have is going to be moving to LTE or is already in that space, so it makes us easier to adopt those products. Samsung, LG, HTC and Motorola. We are looking at all of the things that come with LTE that are still being developed and we are evaluating what that means to the handset. Examples include HD voice for a richer voice experience. We are also looking at other advancements that have not yet been solidified.
11:07AM:We’ve launched Direct Connect products with Kyocera and we will launch a smartphone from Motorola by the end of the quarter. (CDMA Direct Connect).
11:07AM:We will support band class 10 for CDMA voice. We have several products that already support this so those customers are future-proofed.
11:06AM:We’ve had our 1,900MHz spectrum approved by LTE standards for deployment. There are a lot of different bands that play into LTE. In fact, LTE for the first time will be the most consolidated view you’ll get around a radio technology and ecosystem that will be global in deployment. You’ll also see it will rival what you’re seeing in GSM and CDMA today. Hopefully it will be a unifying element in a lot of different carriers.
11:05AM:LTE is the global standard for 4G when it comes to the future. There are 237 operators in 85 countries investing in LTE.
11:05AM:“We are very excited about the LTE products that we’ll deliver during the second half of this year. You’ll see broader coverage, increased capacity, improved push to talk, improved voice quality and data speeds.”
11:03AM:Farid is going to cover LTE and what it means for the device ecosystem, network vision progress in terms of devices, economics of scale with LTE, the LTE device roadmap (although he said he won’t reveal any new products today) as well as Sprint’s relationships around the globe.
11:02AM:A lot of customers dont know the difference between network technologies and it doesnt mean much to them. If you look at the Samsung Galaxy S II Epic Touch, a lot of the technology is sometimes lost on us and the customers. There are 2000 individual parts that go into making the product. One of those is the radio, and to be specific, there are 5 radios in it today. The amount of complexity that we deliver to the marketplace today is quite outstanding.
11:01AM:“For the first time I can answer the question: when are you going to get the iPhone.” Funny.
11:01AM:“I’m not going to divulge any new products that we’re going to be launching. This is going to be very disappointing. But I will talk about what the device strategy means.” Bummer.
11:00AM:Fared Adib, vice president of product development is taking the stage now. “Everyone having fun yet? You all look so happy.”
10:45AM:We’ll be resuming in 15 minutes.
10:38AM:It’s time for a 20 minute break.
10:36AM:Multimode products allow for: flexibility allowing you to deploy whatever frequency band and whatever tech you need. It provides performance gains in roaming reduction and signal on the street and in building. Finally, the cost point. It’s a brand new architecture for driving your cost to serve to a new industry low. It offers economic benefits to Sprint.
10:35AM:Samsung is discussing how it has long term investment in LTE standards and has a lot of involvement in the design of technology. It also launched the first commercial network in the U.S. last year as well as the first LTE network. “We’ve also added four new LTE networks around the world in Asia and in the Middle East in 2011. We have a number more poised for introduction in 2012.”
10:31AM:Sprint’s partners are each discussing successful deployments in their history
10:28AM:Executives from all three companies are on stage for a bit of a panel discussing their partnerships with Sprint and reassuring that they will meet time frames and expectations for the roll-outs.
10:27AM:Sprint has three key partners involved with the infrastructure side of its 4G LTE plans: Samsung, Alcatel Lucent and Ericsson.
10:26AM:Network Vision means that all future upgrades can be done via card plugins. This makes the rollout much, much simpler.
10:24AM:
10:24AM:In fact, coverage in many areas will improve dramatically once 4G LTE replaces 3G service.
10:24AM:Sprint is taking extra care to ensure that the hand-off from 3G to 4G is seamless. Everywhere Sprint has 3G coverage, it will also have 4G coverage.
10:23AM:Sprint’s 4G LTE network will be faster than its WiMAX network.
10:22AM:Customers will see a “viral type of improvement” in 3G coverage during the network rollout process.
10:20AM:This investment is important to us and our customers.
10:19AM:All customers will get partial to full benefits. After a period of a few months, we’ll have upgraded the entire markets.
10:19AM:In NYC we have about 1,100 cell sites around the area. It’s not as simple as pushing a switch to transition. In order to manage the transition and avoid disruption, we’ll turn up the network in clusters. Block by block, borough by borough type of upgrade.
10:18AM:Expected benefits for 3G customers include better signal strength, faster data speeds, better in-building performance, expanded coverage and commitment to long-term 3G. Sprint will also put 3G voice on the 1800 (?) spectrum (pending FCC approval).
10:17AM:Migration from iDEN to CDMA to be completed by mid-2013*
10:15AM:Because it’s based on a CDMA tech we can expand the coverage from 900,000 square miles to extend it to other CDMA networks, roam with it, and expand it to 3x the square miles across the country.
10:15AM:Migrations expected to accelerate and the planned conclusion is to occur by mid 2013.
10:14AM:We expect to see iDEN like performance from our CDMA PTT Direct Connect Network, which launched on October 2nd.
10:14AM:Sprint expects a 20% reduction in green house gas emissions by 2015.
10:13AM:“When you sum it all up, we have made a lot of progress since December. Most all the technical risks are behind us. Another proof point of that are these pictures.” We see images of products from Samsung, Alcatel Lucent and Ericsson. The multimode 3G and 4G base stations are going into the network as we speak.
10:12AM:We see no hurdles and we’ve negotiated win-win deals for us and the tower company supporting players we have. We are prepared for all new device launches including the iPhone. We have been building in the expected impact of the iPhone for quite a few months. We are well prepared to take the expected growth.
10:11AM:We have started work on 22,000 cell sites. The balance will be started in the next few months.
10:10AM:We have to test the tech in the lab and in the field. We’re in the field testing stage. We are testing 4G LTE test calls. We are testing core elements to ensure they are performing as expected. We have hit every single milestone with the performance tests.
10:09AM:Today we have iDEN, the CDMA network (3G business) and then with Clearwire our WiMAX 4G network. Tomorrow, meaning starting very soon in 2012 and 2013, this will be consolidated into a single network platform. The 4G LTE capability will be built on a single architecture along with improvements in 3G capabilities. Sprint direct connect will ride on this as well as LightSquared, after approved by FCC. A single, flexible platform.
10:08AM:He’s going to discuss the “nuts and bolts” of the program. That includes how customers will have an improved experience.
10:07AM:Bob Azzi, senior vice president of Sprint’s network is now on stage.
10:07AM:“We’re extremely excited about network vision, this has been a big year trying to make this all work. Now we are getting into the rhythm of the build and expect by mid-year to make this an absolute reality for our customers.”
10:06AM:We’re in the 60,000 cell sites now and we’d like to be around 40,000.
10:06AM:“The benefits include reduced roaming costs, consolidated networks and site reduction, reduced operating costs and more efficient use of CapEx (50% reduction in cost/GB and a 50% reduction in cost/minute.”
10:05AM:“We believe we can handle the demand of the announcement that was made earlier this week with the iPhone by both our proactive work in optimizing the content and offloading but also with more efficient devices. The iPhone is a very efficient use of our network. Also the improvements other OEMs are making in their devices.”
10:04AM:We can take about 20% off of our network through these kind of capabilities.
10:03AM:“We have been working very hard the last year with various content partners and application developers.” This quarter is the initial roll-out of Wi-Fi offloading technology.
10:02AM:“Pending the FCC approval with LightSquared we will be using 1.6 spectrum for hosted LTE.”
10:02AM:The LTE deployment is going to be rapid. The first markets will be launching in mid- 2012 and will be largely complete by the end of 2013. Our originaly 3-5 year plan is more like a 2-3 year plan. Our devices will be available for the launch of these markets in mid 2012. Working with Qualcomm. Still committed to WiMAX and will be selling WiMAX devices through 2012.
10:01AM:It’s an open network architecture allowing us to get scale and host spectrum.
10:00AM:Sprint is in a unique position to offer hosting solutions and spectrum wholesale to companies like LightSquared.
9:59AM:At the top of the tower in the same radio we’ll have 1.9 LTE, 1.9 CDMA, 800 CDMA and in the future 800 LTE. With LightSquared we’ll have 1600 LTE.
9:58AM:We’re looking at a slide of how the multimode technology can lessen the hardware footprint. “A lot less utility requirement, less footprint, less maintenance and less cost.”
9:58AM:“Technology flexbility” we wanted something we could put CDMA, LTE in the future, and think of ideas to use flexibility for scale. We also wanted to eliminate the iDEN network. We plan to get our customers migrated by 2013 and we started that this year and made a lot of great progress. Two key attributes of Network Vision break into two sides: multinode network platform, and integrated chipsets to power the devices to work with multiple spectrums and multiple techologies.”
9:56AM:Improving the performance and coverage for our customers is one way to reduce churn and gain customers
9:55AM:Sprint will be announcing the “aggressive rollout of LTE” here today, Elfman said.
9:55AM:“Why October 7th? Not to celebrate how things are going in baseball. We want to be at a point where Network Vision was no longer slideware. We have network infrastructure partners here. We want to show the network is working and the handsets are working. We want to talk about the iPhone 4 and the iPhone 4S because they have important usage characteristics that are different than other high selling smartphones. We could not talk about those products before this week. So, without further ado, I will turn it over to Steve Elfman – president network operations and wholesale.”
9:52AM:In Q4 2010 we announced Network Vision with five pillars: customer experience, reduce costs, utilization of assets, flexibility, sustainability.
9:51AM:Launching prepaid services on Sprint’s iDEN network has generated $5 billion in revenue.
9:51AM:“This bought us time to come up with an elegant and technical solution to move to one network and we’re going to talk about that today.”
9:51AM:The three important aspects are brand, people , and network. In Q4 Sprint announced plans to retain its iDEN network and it announced a partnership with Clearwire. In Q1 2009 it launched Boost Unlimited on its iDEN network.
9:50AM:“This will be one of our most profitable devices.” (The iPhone).
9:50AM:Hesse has mentioned several times, “we’re running two networks and our competitors are each running one.” He then follows the comment up each time with, “we’re going to discuss that today.” Things aren’t looking good for WiMAX right now…
9:49AM:Churn was due to a lack of having the iPhone in the past.
9:49AM:“How do we take both of these to the next level? The iPhone.”
9:48AM:“Churn is customers leaving you. Brand is how you attract new ones.”
9:48AM:“Cash is #3 of the key priorities,” Joe will talk more about cash when he takes the stage. “Our margins are still well below the benchmark margins of our two biggest competitors, AT&T and Verizon. We’re running two networks with less volume. Our competitors are running one. That’s the focus of today’s discussion, and churn. Improvements in churn is the quickest, fastest and most significant way to improve the bottom line.”
9:46AM:“The biggest decline, sequentially for us, was 2006 and 2005. 2009 and 2010 we were the only company to improve our net add performance year over year.”
9:45AM:“Sprint is the only company that improved postpaid churn every year.”
9:44AM:“Churn improved every single year but the problem was a decline in gross adds. That was a brand problem.”
9:43AM:Total subscribers were down for 11 consecutive quarters and now they have increased for five consecutive quarters. “We’re on our way back,” Hesse said.
9:43AM:In 2010 Sprint’s reputation improved more than any company in the world. Hesse is referencing data from the Reputation Institute.
9:41AM:Customer experience: Sprint is the most improved wireless company in customer satisfaction over the last three years.
9:39AM:There is a significant financial value that comes with a good brand. Brand is the key to gross ads and our business is all about subscribers.
9:38AM:“Sprint has seen improvements in customer care over the past 14 quarters. Running two networks is complicated, what you’ll see today, is a simpler network.”
9:37AM:“A company is like a person and you can try to pretend to be something on the outside if you are different on the inside.” Simplicity costs less. Take a look at what we’ve done over the last few years. We started with Simply Everything and now we’re maintaining the only unlimited position. Customers like simplicity.”
9:36AM:“Thanks for joining us here in New York. We have a good day for you today where we have an opportunity to talk about our Network Vision Plan, which is really our strategy for the evolution of 3G and 4G.” The Agenda includes Steve Elfman, Bob Azzi, a Partner Panel with Alcatel-Lucent and Samsung, Fared Adib (Devices), Joe Euteneuer (financial ramifications and benefits), and then we will enter a Q&A session.
9:34AM:Sprint CEO Dan Hesse is taking the stage.
9:34AM:VP of investor relations is on the stage. “I want to welcome you to Sprint’s network vision strategy update.” She is going over cautionary statements and explaining we will be going over forward-looking statements.
9:26AM:The event is scheduled to begin in about five minutes and it’s looking like 4G LTE plans will be the star of the show.
9:21AM:We’re told the event will begin in just a few minutes.
9:18AM:Ok guys – we’re inside and settled. Tons of analysts here and plenty of familiar faces.
