While Sprint was the first U.S. carrier to launch a 4G-capable smartphone, shortages of the HTC Evo 4G, due to recession-slowed parts suppliers, is undoing the carrier's lead in its race for mobility subscribers.
Sprint is facing new hurdles in its race against competitors AT&T and
Verizon. The nation's third-largest carrier by subscriber volume, Sprint was
recently the first carrier in the United States to introduce a 4G-capable
smartphone, the HTC Evo 4G. An inability to
keep shelves stocked with the consumer-approved device, however, may prevent it
from holding on to its lead or winning many new customers.
"We thought we would have more of a head start than we'll end up having,"
Sprint CEO Dan Hesse told the Wall Street
Sprint has reportedly sold 300,000 HTC
Evo 4G phones so far, but HTC's suppliers
are having a hard time meeting its demand for parts, leaving Sprint in the
lurch. The Sprint Website currently doesn't even offer consumers a prospective
shipping date, but tells them instead: "Sorry, this device is so hot we
can't keep it on our virtual shelves. Check back later-more are on their way!"
According to the Journal, it's the Evo's big, beautiful display-the largest
on a touch screen to date, at 4.3 inches -that's causing the major hold-up. HTC
has reportedly signed a new deal with Sony to manufacture the displays while
supplier Samsung builds a new factory. Conveyor belts at the new Sony plant,
however, aren't expected to begin rolling until 2012.
The supplier's inability to meet demand is largely a factor of the global
recession. Hesse told the Journal that in 2009 "high-tech
capacity was taken offline, and now it needs to be brought back up."
Sprint pairs the Evo 4G, as well as its modem devices such as the Overdrive
3G/4G Mobile Hotspot,
with the 4G technology WiMax, through Clearwire,
which Sprint owns a majority share of. AT&T and Verizon, however, plan to
roll out 4G using the competing LTE (Long-Term Evolution) technology. Verizon's
4G network is scheduled to go live in the fourth quarter, with AT&T
following in 2011. Analysts have long suggested that despite WiMax having the
head start, LTE will ultimately be the dominant technology-an
idea Hesse has seconded.
In March, he told an audience at the CTIA Wireless trade
show that, while LTE will most likely dominate in the end, "We couldn't
wait. ... Time to market was very important. That is our competitive position."
A shortage in supplies of its most impressive smartphone to date, however,
may significantly damage Sprint's position. During the company's first fiscal
quarter of 2010-which it announced in April, before the launch of the HTC
Evo 4G-it posted
a loss of $865 million on revenue of $8.1 billion.
Sprint lost 75,000
subscribers during the quarter, although that was far fewer than it had lost in
Still, Sprint continues to push ahead. The company announced June 28 that
later in the summer it would launch the nation's second 4G-capable smartphone, the
Samsung Epic 4G.
The Epic's touch screen will be a 4-inch Super AMOLED that
Sprint described as offering the "best representation of color on a mobile