Jeff Kagan: Confusion on Sprint 2.5 Direction

Jeff Kagan  |

There seems to be some confusion and misinterpretation about Sprint (S) in the media during the last few days. I spoke with Sprint for clarification. You will be interested in what I learned.

I am a technology industry analyst and as such follow many companies in the wireless industry from a competitive point of view. Sprint is one of those companies as one of the top three wireless networks in the United States.

Last week I wrote a column here titled Jeff Kagan: The State of Sprint Recovery. I shared thoughts and opinions on Sprints future after their new CEO Marcelo Claure spoke with reporter David Faber, live on CNBC that same morning just before giving a speech at Communacopia, the Goldman Sachs (GS) annual communications and media conference.

I thought the CNBC interview was clear and impressive. However at Communacopia, some analysts and media seemed to misunderstand the Sprint CEO.

So I spoke with Sprint to get a clarification. Dan Wright from Sprint Corporate Communications said nothing had changed about their plan so there should be no confusion. That was good to hear.

My thoughts on Sprint under new leadership so far are positive. Whether they are successful long-term, we will have to wait to see. It’s important for us to keep in mind that Sprint is now a new and different company going forward under the new leadership.

In an effort to clear things up, Wright shared the text of CEO Marcelo Claure’s speech at Communacopia.

"What I think we are going to do different? I think we are going to move to a smarter model in terms of how do we deploy our network,” said Claure.

“When I got there, the initial plan is, let’s just deploy 2.5 across our 33,000 sites. What it means is it takes you too long to be good anywhere. So we are changing our deployment plan that’s going to be really, really focused on 2.5.”

“First we are going to focus in areas where our network is congested. There are parts, everybody’s network, Verizon (VZ), AT&T (T), T-Mobile’s (TMUS) network, there are certain peak times that the network gets congested. But what we have that nobody else has is we have that rich spectrum on 2.5 that brings additional capacity.”

“So, we are going to focus first and foremost to make sure that we are building 2.5 for our current 3G and 4G networks capacity. So that way you are going to enhance the experience.”

“And then secondly, we are going to go strong after a few cities rather than building out the 33,000 sites, we are going to first focus on getting the – getting a certain amount of cities, where we can provide customers our end-to-end experience.”

“When you look at what the vision with Spark is, it’s about we have the compelling advantage that identifies what is the – which spectrum, which band we are going to use to better serve you.”

“So, now once we build 2.5 in some selected markets that we will be announcing soon, we are going to focus on those markets and provide an experience of the speeds that haven’t been deployed in the U.S. again before. So, you are going to see a really, really focused effort in terms of where do we deploy it and how do we use our capital and CapEx a lot more effective than we have had.”

“There is no need to plaster the nation with 2.5, because it’s going to take us too long. So, we want to get some early wins by providing (2.5 in a more focused manner).”

So the misinterpretation is that Sprint is scaling back on it’s original 2.5 deployment, but according to Sprint, nothing could be furthur from the truth.

Wright says Sprint is still on track to cover 100 million POPs by the end of the year, as they have stated all along.

Claure was referring to the next phase of 2.5 deployment, during which they will focus on density builds in key markets.

Having the media and analyst community understand what you are saying is crucial to success.

This is an important lesson for every company to learn. Make sure every word that you say is clear and helpful. Any confusion will create a confusing mix of stories that will keep the marketplace confused.

And the marketplace does not like confusion. They like to understand clearly every step of the journey.

As for Sprint, they remain on a solid path to deliver 2.5 to the same key markets by year end. There may be some changes to the longer-term plan, but there always are with any company.


DISCLOSURE: The views and opinions expressed in this article are those of the authors, and do not represent the views of Readers should not consider statements made by the author as formal recommendations and should consult their financial advisor before making any investment decisions. To read our full disclosure, please go to:


Symbol Name Price Change % Volume
S Sprint Corporation 5.97 -0.10 -1.65 11,548,261 Trade
TMUS T-Mobile US Inc. 65.65 -0.71 -1.07 2,872,853 Trade
VZ Verizon Communications Inc. 57.08 -0.01 -0.02 13,960,870 Trade
T AT&T Inc. 30.22 0.31 1.04 42,741,389 Trade



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