If you can’t beat ’em, might as well go down fighting.
That’s the takeaway I have from Sprint’s public relations blitz Monday, one day after No. 4 carrier T-Mobile agreed to be bought out by AT&T for $39 billion.
To summarize, Sprint said March 21 it would:
- sell the Samsung Nexus S 4G this spring for $199.99;
- offer Google Voice free on all of its CDMA (Code Division Multiple Access) phones (wow!);
- give all existing Samsung Epic 4G and Samsung Galaxy Tab owners with Sprint an over-the-air software update to give users access to Sprint ID; and
- include in the software update the Android 2.2 “Froyo” operating system update for the Samsung Epic 4G, several months after the phone launched.
This might seem like Christmas for many of the 50 million existing Sprint subscribers, but it’s actually a defensive maneuver for a company threatened with being relegated to the unsavory position T-Mobile is in: No. 3 in a shrinking carrier market.
Yes, Sprint is already No. 3 now, behind AT&T (95.5 million users) and Verizon Wireless (94.1 million subscribers), but there were talks Sprint might buy T-Mobile or merge with Clearwire to beef up its 4G WiMAX offerings.
The former option appears out for Sprint, and AT&T stands to accelerate its 4G LTE (Long-Term Evolution) network plans at the expense of the rest.
That would put the carrier at, at a minimum, 130 million users by this time next year, with Verizon itself vaulting well over the 100 million user mark from normal, annualized growth.
Obviously, Sprint was unhappy about this, telling reporters:
“If approved, the merger would result in a wireless industry dominated overwhelmingly by two vertically integrated companies that control almost 80% of the U.S. wireless post-paid market, as well as the availability and price of key inputs such as backhaul and access needed by other wireless companies to compete. The Departement of Justice and the Federal Communications Commission must decide if this transaction is in the best interest of consumers and the U.S. economy overall, and determine if innovation and robust competition would be affected adversely by this dramatic change in the structure of the industry.“
Usually, that stuff is sour grapes. In this case, it’s 100 percent true.
Where does Sprint fit in? How does it compete with two giants? Other than a buyout from Verizon, I’m not sure where. Neither is Sprint, if stories of CEO Dan Hesse falling out of his chair on the merger news are true.
Hence, the PR blast of the Nexus S 4G, free Google Voice and Sprint ID upgrade, with the side benefit of Froyo for the Epic 4G.
Of these moves, the Google Voice bit is the biggest; Sprint is the first and only carrier to allow users to use their existing mobile phone number without paying porting fees. Google itself charges $20, and activating it results in the termination of a user’s contract with his or her carrier and potentially an early-termination fee.
I’ve no doubt these products and moves were all in Sprint’s pipeline. Heck, they might have even planned to announce some of them this week at the CTIA show in Orlando, where other Sprint devices are allegedly on tap.
My guess is, AT&T and T-Mobile forced Sprint’s hand to announce these items sooner, and Sprint scrambled and fell over several chairs to launch these big-news pieces–because, for Sprint, these Google Android-oriented moves, are big news.
And it made three of them on the same day, mostly centered around 4G service, striking at the very heart of what AT&T wants to do with T-Mobile in the future.
Coincidence? I think not!