Most of the attention has been on Sprint's participation in the 600MHz incentive auction next year. In the past Sprint/Hesse had pooh-poohed the question of whether Sprint would participate. More recently, however, Sprint and Softbank has joined T-Mobile in pressing the FCC/DoJ to set the rules to provide set-aside for smaller operators or otherwise prevent AT&T and Verizon from dominating the auction similar to as they had done in the previous 700MHz auction. Mixed messages. Its not uncommon for operators to dismiss speculation that they plan to participate in auctions... to throw off other bidders and partly because their decision may depend on how the auction shapes up.
Sprint has thus far dismissed participation in this Fall's AWS-3 auction. This is a seldom mentioned auction that can play a role in how competition unrolls over the next few years, particularly in regard to higher broadband or TV/video capacity. AWS-3 spectrum includes 1695-1710 MHz, 1755-1780 MHz, and 2155-2180 MHz bands - a total of 65 MHz of additional spectrum.
When you consider what operators can do with spectrum a general answer is 'it depends on the frequency band'. AWS spectrum has been described as being in the sweet spot of 'wireless broadband spectrum' because it is low enough to have fairly good range while high enough to use smaller cells and avoid some problems of interference of lower frequency bands. Each band has trade-offs with longer range and building penetration trading off for more overlap of signals/higher interference. The 'Best Spectrum' is a competitive mix: sub 1GHz for wide coverage using fewer base stations or small cells, mid-band 1GHz to 2.2GHz for 'broadband coverage', and 2.3GHz for high density, smaller cell broadband up to goals of 1Gbps+.
I think Legere is only a benefit to Sprint-Softbank by being a competitive stimulus that calls S-SB into action. Legere is a competitor, his role is mostly adversarial - T-MUS is taking share away from Sprint or what would otherwise be possible for S to win using lower price, easy contract conversion and low hassle device and contract strategies.
Legere/TMUS are also raising the cost of being acquired through recent increased competitiveness. I've suggested that a deal might not be as favorable to investors or Sprint-SB as some think. The attractiveness diminishes as the price goes up, moderated by having more subscribers in the deal.
Sprint's primary way to improve network and competitive performance is to get a more balanced portfolio of spectrum and deploy using more aggressive technologies. The path to do that is better laid out with the inclusion of NSN and complimentary small suppliers like Airspan. And Sprint can more aggressively expand rural/secondary market coverage with NetAmerica's independent operators. The remaining gaps are additional sub 1GHz spectrum and/or ability to deploy into 2.6GHz more cost and performance effectively.
If it were possible to change Sprint's network situation to answer the question of how they can become more competitive with the duopoly, it would be to have 24MHz (20MHz plus guard bands) of 600-700MHz spectrum and up and running with devices going into the market now. That is not possible because it takes time to acquire spectrum (600MHz auction next year) and field networks and devices (2 years). However, a greatly expanded plan to use 2.6GHz with or without DISH as a partner would also take a couple years.
What would be better, making the offer to acquire T-Mobile or waiting for the 600MHz auction next year?
I don't think DoJ and FCC will allow the acq. this year or, if the situation changes to justify a shift in their thinking, sooner than next year.. so why not wait to bid on 600MHz?
I've thought about it, having been a virgin to wireless and Sprint like so many here.. LOL!
Sprint has been a financial basket case for many years. Does anyone dispute that? What has been their financial history? Anyone who can read knows S has been a turn-around story for 6+ years and that many moves that proved decisively wrong or made wrong to the extent S overpaid paid or did with their acquisitions and position. That should be understood as a baseline. The question has been 'will they turn around and become more competitive?'. Many chide Sprint for having deployed WiMAX. I don't. The basic decision to deploy was made because Sprint had no other choice at the time. However, what Sprint did with WiMAX, from the selection of vendors to how they deployed was deeply flawed imo. I think acquiring Nextel was a mistake because they paid 3X what it was worth. that probably was a factor in how long they hung onto the iDEN platform.. not wanting to admit how much of a blunder the $35 biilion+ price tag was.
The reason to hash out this history is to figure out what has or has not been the past approach and how the company tends to make decisions so that better outcomes might now be pursued. Company culture matters. How management and BODs decide major issues matters. History matters shouldn't be ignored. What do they teach in B-School? History of companies (decisions) - so that the new crop of managers can figure things out.
Sprint is a real stinker.
Why do you bother posting about someone else posting on the Internet.. m=how lame and #$%$ is that? If youse donna like what I post, put me on ignore lamo.
So, the FCC and DoJ should not back down because of threats from AT&T.. no more so than they should back down from the threat that Sprint needs to acquire T-Mobile or else it will (continue) to fail to be profitable.
Just read it or not idiot. If you don't think its worth educating yourself in the subject matter, then don't. Your post is har, har, har dumb.
That extreme of attention grabbing headlines seen in some articles and analysts reports is, nonetheless, at the heart of what was called the 'Wireless Broadband Revolution" thinking that started over 15 years ago.
The 'frontier' in wireless was long thought to have been tackling the challenge of the 'Shannon-Hartley' law of maximum data communications in a given bandwidth channel. Both HSPA and LTE (WiMAX for that matter) have approached the practical limits of S-H - to within tenths of a bits/Hz. What has become the new frontier is the 'spatial domain' of wireless... or, more completely, the use of time-space signaling methodologies. This has required building a multi-faceted framework of technologies into the standards (bot for WLAN and mobile RAN) that fits into IT/Networking including SDN, software defined networks. Explaining this in detail is out of place here... if interested, do some reading of Cisco, Qualcomm, Ericsson, Motorola, NSN, LU, and numerous other consumer level white papers.
What still gives Sprint-Softbank hope despite the problems is that this is still early on in the revolution. If Sprintsy-wintsy were to become a 'true Maverick' rather than the laughing stock of US operators, things could unfold in their favor over time.
However, the long anticipated "WBB Revolution" is now entering mainstream adoption... the chips, devices, and means to fashion them into comprehensive solutions is upon us/Sprint. If Sprint does not 'eat their own' Verizon, AT&T and TMUS probably will.
Sprint has been steps away from bankruptcy for years... and was likely to have headed their more quickly if not for being acquired by Sprint... that is simple reality everyone here, with half a brain, already has digested.
What has kept Sprint alive is the unique status of mobile operators that sets the business model apart from many others: operators have an exclusive license, a state-sanctioned monopoly, on the use of spectrum. And mobile service business is a huge cash flow machine.. to some degree, past mistakes can be fostered over to the next generation of networks. Even though debts mount up, so too has revenue in the sector... in essence a glorified Ponzi scheme. Sprint made several timing and degree missteps, the most blaring being overpaying for Nextel coupled with lack of a plan to convert the network smoothly to use as 3G or 4G. That came at a time when the industry was experiencing a shift in prices they could charge for voice and texting and when mobile apps have taken over specialized applications such as PTT, push to talk. Sprint paid inflated price for dinosaur network and then failed to convert/use the spectrum and marketshare.
Along came Masayoshi Son/Softbank with fresh experience building 'massively smallcell' networks including use of 2.5GHz spectrum. That hit upon the shores of America to find competitors already in position to counter easy moves. With Sprint being among the world's most reticent of old school network operators, Mr. Son has expressed frustration at the 'no, not here' Sprint complacency.. and thus looks to save his/their buttocks by acquiring T-Mobile... if only regulators will cave in to the new theme "We can't innovate so you must equivocate".. let us acquire our way out of our jam pleading to the DoJ and FCC.
There is hope... fire enough people that change starts looking good.
This may seem like a waste of time, however, investors should get some grounding in where technology is developing that can impact Sprint.. in good or (competitively) bad ways:
The way wireless networks and devices communicate has been going through a revolution, significantly pushed from outside of the 'cellular networks'. MIMO and OFDM technologies now part of HSDPA+ and LTE were used years prior in 802.11n and 802.16 WiMAX.
The newer technology that has yet to make its mark are MU-MIMO, coordinated MIMO nodes and SUs, and the corresponding use of smallcells including their ability to become 'Smart' and take on network management functions that previously required base stations at cell towers.
So what? Because as chips and devices become available they will reshape how networks work, making some operators more competitive while others fall behind.
Years ago stemming from study of patents and research papers, I advised clients to pursue 'smart networking technologies' of which I included what is now called SDN, software defined networks, and Co-MIMO, MU-MIMO and SONs, self-forming/self-organized network capabilities. These have gone from a handful of early patents ~ten years ago to literally many hundreds of patent applications today ( I count well over 2,500).
What happens if, as some have suggested, there is a surplus of bandwidth possible if networks can be deployed as densely needed? (read some papers to get the concepts). Will Sprintsy-wintsy continue to lag? Or will Mr. Son have kicked enough kester to change things soon enough to matter?
Sprint needs lower freq. spectrum but that will take about 2 years... auction next year. The opportunity is now, not on Sprint time... ie. manana.. tomorrow, maybe.
No, there is no quick fix because the scope of the things needed to be accomplished are large and take time. However, Sprint can "build in" new ways to deploy networks and build business.. investors should hope that they do so before their competitors beat them, once again, to the finish line.
For instance, parts of the 'advanced network technologies' that have been coming up with Wi-Fi and 3G+ and 4G technology streams and are fashioned into the advanced network standards are now springing forward into volume production of chips that go into SmartPhones, pads, and network devices. Qualcomm and Mediatek have put 802.11ac into their newest wireless device chips. And Qualcomm, MTK, Broadcom, and others are coming out with MU-MIMO, multi-user MIMO, Co-MIMO, that is basically common between 802.11ac and LTE-Advanced chipsets for network nodes and devices.
I was going to post a long-winded explanation.. but these terms can be looked up.
What Co-MIMO.MU-MIMO help enable in new lines of chips is the ability to reach 10-100x bandwidth performance. This will require much higher degree of small cells. If its to be used beyond the stadiums, airports and other convenient locations, new ways of deployment must be used or Softbank will need to find more more Alibabas to sell imo.
Here's a recent article about new chips: Search on: Quantenna: 8X8 MIMO WiFi
Qualcomm, as mentioned before, wants to bring LTE MU-MIMO/Co-MIMO to LTE use in unlicensed as well as licensed spectrum.
Will Sprint lead or lag the "1,000X" WBB revolution?
Sprint had moved down to the bottom of a 2 month range and has bounced a bit. This confirms a post of last week that suggested S was near a support level and might bounce. The technical analysis now looks short term bullish, mid-term bullish for a move up into the range between support at 7.96 (recent low) and ~9.40. The market, quarterly results and other news are, of course, important variables.
Financial analysts rate S as an underperformer 1 strong buy, 1 buy, 19 holds, 4 underperform, and 2 sell ratings. VZ, T, and TMUS rank higher. Analysts had pulled back ratings on all operators often citing valuation concerns. The recent downturn in the markets may cause reappraisal at some point.
I don't primarily blame Hesse for Sprints results. There were some things that I have strongly disagreed with in the management of Sprint but attribute the bulk of that to prior mistakes that threw Sprint into debt and lacking momentum. Hesse did not shape the deal with Clearwire. Despite expressing frustration over how Clearwire was operated, including heavy marketing costs which blew up the expense side with meager results in direct sales, Hesse was unable to either get Clearwire to stop deployment of WiMAX or otherwise trim costs. That was already much too late to change the course of deployments, such as to hire Nokia-Siemens plus network node device suppliers including Airspan as Sprint has recently announced. And Hesse did not acquire Nextel for $35 billion which then cost billions more as subscribers fled as 3G and, latter, 4G was rolled out. The total 'cost' of Nextel might well be calculated at $45-$50 billion and lost 'opportunity cost' of billions more compared to what Sprint might otherwise have done if that money were spent acquiring and deploying into 700 MHz and AWS spectrum instead.
Hesse inherited a deeply rooted mess and an organization that was conflicted with legacy networks, devices, and people that have taken years to dig out from and which still holds back the company imo. Maybe there is a New Sprint.. the results are not in yet imo.
I have respect for Masa Son. However, 'I don't even trust myself' to do what 'should be done' all the time. Masa Son has to be held to account for what he does, not what he has done or says he might do. "I want to be number 1" sounds like malarky no matter who says it.. until they prove it to be so.
I think that is fair to say they are at the beginning of their (re)defining moments. I would not 'rag on them' so much if not for the many opportunities they might pursue, including some that hold promise of being disruptive use models. However, Sprint must more fully break out of its box. If you ask industry analysts who is doing smallcell, HetNet, advanced architectures, use of MAS-AAS, and other innovations available using LTE basket of technologies and methods, the answer would likely be a listing of Verizon, AT&T, T-Mobile with Sprint only mentioned as a participant but certainly not standing out above the crowd. I can think of several examples of Verizon and AT&T taking leadership in key technology applications... Sprint not much or only poorly. This does appear to be changing under Softbank. However too many rocks have yet to be turned over... and impact of what has been done or is in trials has yet to change Sprint's trajectory in subscribers or revenue or has been offset by competitors moves.
For the past ~15 years a big question facing Sprint is how or would the company make use of what they had, namely unused 2.6GHz spectrum to best their competitors into opening up new WBA, wireless BB access, and TV markets. What is so disgusting to some of us is its still the question.
Nice try..but your analysis is weak..
Your post provides some otherwise useful information, ie. that Sprint will have LTE rolled out in their 5x5 MHz FDD in the 800 MHz band. What can that be used for and how does that compare to rivals spectrum? Enlighten the peanut gallery.
From FCC, Fed Registry, Feb, 19, 2014: "The Commission proposes rules that would permit Globalstar to provide low-power ATC using its licensed spectrum at 2483.5– 2495 MHz under certain limited technical criteria and, with the same equipment, to utilize spectrum in the adjacent 2473–2483.5 MHz band pursuant to the applicable technical rules for unlicensed operations in that band. The Commission seeks comment on this possible deployment of broadband access equipment, on whether it is thereby possible to enable more efficient use of spectrum in the 2483.5–2495 MHz band and the adjacent 2473–2483.5 MHz band and to increase the amount of spectrum available for broadband access in the United States. However, significant concerns have been raised about potential detrimental impacts on licensed services that operate in the 2483.5–2500 MHz and 2496–2690 MHz bands and unlicensed devices that operate in the 2400–2483.5 MHz band"
How does the FCC and DoJ determine an operator is a Maverick? By the impact of their actions. Words alone are not enough. Son promised heightened competition... thus far T-Mobile is doing more to deliver that than Sprint. So, who gets labeled as the Maverick? Rightly so, T-Mobile.
Calling Masa Son the ultimate Maverick comes before he has proven to be a good 'baby' maverick. Thus far the steps being taken might prove to be laying of a foundation or just so much posturing. Take the deal with NetAmerica. Is that going to result in little due to lack of population density to stimulate its own device and network momentum? Or will the rural operators simply lack the financial muscle to acquire enough spectrum and do the deployments to make much of a difference? Toss a coin until the talk becomes the walk. As suggested previously, Softbank-Sprint could help fund acquisition of spectrum beyond their direct needs by forming a 'blind trust' that small operators could apply. Since NetAmerica has already agreed to build 'Spark' compatible networks and use of devices, getting independents to agree to do so under a loan agreement is tacitly accomplished.
Irons in lots of fires: Sprint has opposed Globalstar's proposed use of spectrum that adjoins bot 2.4GHz WiFi and the 2.5-2.6GHz licensed and BRS spectrum. Couldn't Sprint do something 'Mavericky' with that? I don't see how that would be earth shattering.. but what if Sprintsy-wintsy took 20-50 MHz of 2.5GHz to be used as a their own form of 'licensed light' spectrum in combination with Globalstar+upper band WiFi? That would take a lot of things to work out... the point is, instead of objecting to innovations, Sprint should become at least somewhat of a Maverick that goes outside the confined thinking... everywhere they possibly can. They should think in terms of what works and what can throw a wrench into Verizon and AT&T's operations.
Who says Amazon or Globalstar are interested in WiMAX? You just made it up. No captain, Globalstar has proposed to the FCC that they be allowed to use the upper band of 802.11/b/g/n spectrum with their adjoining MSS spectrum band to be used as a higher power portion of 'super Wi-Fi'. There has been stiff opposition to that from Wi-Fi and consumer advocacy groups who want more rather than less spectrum allocated to unlicensed use.
The concept of using the robust Wi-Fi proliferation and ease of use with a licensed network designed for longer range and better building penetration has appeal. That approach has proven very successful by the defacto (stumble-upon) combined use of mobile standards with hacked on WiFi. In fact, 802.11ac and joint efforts within 3GPP hope to make use of LTE and Wi-Fi more seamless by being able to perform hand-offs of data and calls. Gee, maybe if a common system is designed the use of user-deployed units would deliver cost and coverage benefits to operators... too bad Sprintsy-wintsy does not know how to do that.
Or maybe they do and just need a cattle prod by Mr. Son.
Qualcomm is among advocates of using LTE in unlicensed spectrum. This approach has some resistance.. it is similar to efforts several years ago by the challenging 802.16e/+ standard to allow use of that standard in unlicensed space. It failed to gain sponsorship among companies to make it fly. Even Qualcomm faces an uphill battle getting BORG companies to pursue LTE as an extended form of Wi-Fi... with fallback of course.
The efforts by the FCC and DoJ are fraught with political and legal limitations.. and probably a fair amount of bureaucratic misunderstanding of how commercial markets work. All past efforts have failed to prevent the BORG from advancing to consolidate spectrum and markets. Control the cash flow and supply chain, and you control the hearts and minds of the market/wallets. Rural/small operators or, similarly, unlicensed use, ends up with almost worthless scraps of spectrum because building of commercial momentum has proven overwhelmingly difficult. That was the case for the microwave oven sharing 2.4GHz junk Wi-Fi spectrum until the wireless chip technology proved to overcome it. Ask this question: If the development of Wi-Fi would have been forecast prior to 802.11b/g/n, would mobile operators not have caused the spectrum to be taken back for their use? The facts are clear - they would have tried. Search the FCC.gov site.. AT&T, Verizon have argued for take-back even after Wi-Fi has proven so successful... with Sprint and TMUS going along.
Softbank-Sprint has a chance to reverse this history of monopolistic lust for spectrum and markets... at least to a degree that it helps out rural competition and themselves in the bargain. That won't make them 'people's choice' award winners for pro-competitive forces of open networks... just more reasonable actors than they can paint Verizon and AT&T.. as TMUS puts it 'uncarrier' type message... or 'anti-BORG' duopolists.
So, how do you think this will impact Sprint and the prospects for collaboration with its new rural/small operator consortium partner, NetAmerica?
It will take some analysis of the details of FCC rulemaking on the auction. The WSJ article only days that 30MHz of the incentive auction 600MHz spectrum might be set aside for small operators to bid if a threshold is met. That can be a muddy proposition. The 700MHz auction used a two-tiered approach that included both larger blocks and coverage that is attractive to the major operators and smaller plots that were supposed to be attractive to the smaller, rural operators. The problem with that arrangement has been that the smaller plots of spectrum did not have the market size to attract device and chip suppliers. It also was more conflicted with interference problems and tight banding that required more work on RF filters and antennas. The FCC got AT&T and Verizon to recently agree to go along with measures to facilitate common device development and roaming. That is what got DISH and T-Mobile to pursue the scraps of 700MHz spectrum... the hope it can be made into viable spectrum by having devices that will work across it and current VZ and T 700MHz. Even so, it is an uphill effort to bring that about.
So how will the FCC set-aside for 600MHz help out small operators if it takes 'critical mass' to make devices available? It seems to me that it can come together under the Sprint-Softbank deal with NetAmerica that calls for common use of networks and devices and joint roaming. This is where Softbank can play a role that makes Verizon and AT&T look like what Masa Son, Hesse and Legere claim they are, anti-competitive duopolists. Sprint-Softbank would ingratiate themselves with the DoJ and FCC if they cause common devices and networks to come into the market... a rural 'greening' of the sub-1GHz spectrum use. They do that and expansion into media, satellite, etc. would be more welcome by the regs imo.