Sprint Posts Loss, Puts Faith in Palm Pre, Pixi, Android

Sprint lost 801,000 post-paid subscribers during the third quarter, which was an improvement the quarter before. Slowing the exodus is an expanding device portfolio. In addition to the Palm Pre, Sprint's lineup will soon include the Palm Pixi and the Android-running HTC Hero and Samsung Moment.

Sprint continued to see customer losses in the third quarter of 2009, the company reported during an Oct. 29 quarterly earnings call. Customer numbers fell by 1 percent from the previous quarter, down to 48.3 million. Rivals AT&T and Verizon, which each also announced profits in the past few days, added 2 million and 1.2 million customers respectively.
Sprint's net operating revenues additionally fell to $8 billion, from 8.8 billion a year earlier, representing a net loss of $478 million. Sprint's year-over-year post-paid gross addition improvement, however, was the best in its history, the company said.
During the quarter Sprint additionally lost 801,000 post-paid subscribers, though this was an improvement over the previous quarter's 991,000 subscribers, likely thanks to the Palm Pre.
The Palm Pre has helped Sprint to re-garner some customer interest, and on Oct. 12 Sprint additionally launched the HTC Hero, making it the second carrier to offer a smartphone on running Google's popular Android operating system. On Nov. 1, Sprint will add another Android phone, the Samsung Moment, to its roster.
"It's fair to assume that we'll have more Android devices coming out going forward, as well as other [operating systems]," Hesse said during a quarterly conference call with media and analysts to discuss Sprint's results.
Hesse pointed out that Sprint supports Samsung Intrepid, which runs Microsoft's Windows 6.5, Research In Motion's BlackBerry Tour, with the RIM OS, and that the Palm Pixi, running Palm's webOS, is coming out soon.
The Pixi, which offers a smaller screen and a keyboard on its front, instead of sliding out, as on the Pre, will arrive Nov. 15 for a $99.99.
"I think people thought that Apple completely had locked it up, but [the competition] does seem to be a bit more open than I first thought it was," analyst Roger Kay, with Endpoint Technology, told eWEEK.
"Apple has bragged under its breathe that it's a few years ahead of the competition, and maybe that's true, but I think that other companies can narrow that gap." Kay paused then added, "And who knows what they're working on - maybe they're right and they are two years ahead. But in this industry, sometimes to be ahead by a quarter can make a difference."
Kay said that Sprint seems to be offering more platforms than it did a year ago, which is likely to help its situation. "If some of their platforms are bridging the gap with Apple, that may position them better than in the past, so subscribers are leaving them less quickly than they did before," he said.
Sprint is also working to rollout 4G WiMAX coverage with Clearwire, which it owns the majority share of. Saying that Sprint's iDEN network has higher churn than its CDMA network, Hesse offered, "Think of Clearwire as the next wave of iDEN." The capital required for expansion can be mitigated, Hesse said, on the Clearwire side. Sprint 4G is now available in 17 markets, and it expects coverage to grow to 80 markets and 120 million people by the end of 2010.
On the call, Hesse conceded, "We've had some successes during the third quarter, but we still have much progress to make."