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There seems to be strong signs of life at Sprint (S), and times may be getting better and stronger for the wireless carrier going forward. Sprint has spent much of the last decade in a self-inflicted death spiral. They tried, time and again, to recover. The best they had done in the past was to stop the bleeding and show slight growth. Now, finally, things seem to be getting much better and stronger. Growth is starting to look positive going forward. This is just the beginning of the Sprint recovery.
A great example of the Sprint recovery is the most recent quarterly earnings report. They added 405,000 net new post-paid customers. This is the highest growth rate Sprint has shown in several years.
Sprint Recovery Strengthening
Yesterday, Sprint customers complained about poor service. That is no longer the case. In fact, Sprint points to research saying they are within one percent of both Verizon Wireless (VZ), AT&T Mobility and T-Mobile (TMUS). That phrase is echoing throughout the marketplace, and users are now considering Sprint once again.
In addition to improved service, Sprint has been offering very attractively priced packages as well, at a very low cost. This is attracting more customers as well. So, as long as their prices stay low and their service continues to get better, I see Sprint continuing to recover and grow.
CEO Marcelo Claure Says Sprint Turning Corner
Sprint CEO Marcelo Claure says they are turning the corner. I agree. It has been a long wait to see the company turn around, but it looks like it is happening. Their strong quarter showed more growth at Sprint than at most of their competitors.
In fact, Verizon has taken to the airwaves with Jamie Foxx and two goofy looking clones for Sprint and T-Mobile. He talks about how strong Verizon Wireless is. What is not said is that this is only necessary because both Sprint and T-Mobile seem to be taking marketshare from Verizon. And this is Verizon’s counter punch.
Sprint Paul Marcarelli vs. Verizon Jamie Foxx
That’s why Sprint signing Paul Marcarelli is such a big deal. He’s the old Verizon, “Can you hear me now?” guy. This is a good way for Sprint to punch their way back onto the playing field with good humor. And they are punching Verizon Wireless in the gut with every advertisement.
So, all signs seem to point to a strengthening Sprint. That is good. We want to see the top four wireless carriers in a strong, competitive position. Now, we prepare for the next wave of wireless transformation.
Three Buckets of New Growth in Wireless
Wireless growth going forward seems to fall into three different buckets. One is the traditional wireless marketplace. In this space, we see all four wireless carriers continue to compete. Two, is the new wireless marketplace. This represents wireless carriers helping other companies in other industries modernize the way they do business. Three, M2M or B2B. This is all of the IoT, that goes on behind the scenes helping smart companies and smart cities change and grow.
Growth over the last decade came from the smartphone revolution. This year is the ten-year anniversary of the Apple (AAPL) iPhone and Google (GOOG) Android. Going forward, over the coming years, these same opportunities will help Sprint and T-Mobile grow. AT&T Mobility and Verizon Wireless will also grow in this sector, but they will show strong growth in other sectors which I regularly write about.
Wireless Grows with Smartphone, IoT, M2M, B2B
This simply means we can expect to see strong growth going forward, although there will be different growth paths for each of the top four wireless carriers. That’s the good news. However, all the wireless carriers will progress on a different path. Sprint and T-Mobile will take a similar path. AT&T and Verizon will take a different growth path from each other.
So, wireless is getting more complex. Then again, we have seen this industry grow and changes many times of the last several decades. So, this is just one more step in the long wireless journey.
The good news is we now have four strong, national wireless competitors in the marketplace. That’s great. In fact, the wireless marketplace continues to grow and to change. Consider Google Project Fi or Comcast (CMCSA) and Charter (CHTR), who say they will re-enter the wireless industry in coming months.
So, wireless is changing. Wireless is growing. Wireless is the center of the universe for many different industries going forward. That’s the good news. In that world, there is plenty of room for growth for all carriers in different ways.
Jeff Kagan is an Equities.com columnist. Kagan is a Wireless Analyst, Telecom Analyst, Industry Analyst, speaker and consultant. He follows wireless, wire line, telecom, Internet, cable TV, IPTV, Cloud, Mobile Pay, FinTech and communications technology. Email him at [email protected]. His web site is www.jeffKAGAN.com. Follow him on Twitter @jeffkagan
