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Analysts Skeptical Of Sprint’s Network Plans

January 19, 2016 - Written By Daniel Fuller

Last week, it was revealed that Sprint is planning a massive network overhaul. This overhaul is aimed at cutting costs and upping network performance, but will take a huge investment of both time and money. The proposed plan includes moving a number of cell sites to government-owned land to net lower lease costs, as well as moving over to a microwave backend to avoid paying rivals AT&T and Verizon roughly $1 billion per year. The plan has a lot of serious issues that Sprint will have to overcome before they can move forward, not the least of which is Sprint’s track record with network changes, often leaving users with an unstable and slow connection in the interim.

Other challenges facing the plan include long-term cell site contacts that prohibit moves from happening for a while, network limitations imposed by moving over to micro cell sites as opposed to the macro types they’re using now, and marketing issues. Consumer faith in Sprint isn’t as great as it could be, as evidenced by the fact that they’ve lost their suitor, Softbank’ Masayoshi Son, a whopping $3 billion and been passed up for the number 3 spot among U.S. carriers by T-Mobile. After the last few and given all the negative press from the tech sector, Sprint users and would-be users likely won’t enjoy hearing another network change is on the way. Analysts and industry insiders seem to be on the same page.

Walter Piecyk of BTIG noted that, “The tower companies we spoke with seemed unaware of Sprint’s latest version of its network plan…”, which is enough to raise eyebrows in and of itself. Add to that his statement that “Sprint’s lack of information on the network has created confusion in the market which may be extending to potential customers. Press stories about cell site reductions is simply not the best way to convince consumers that Sprint’s network performance is about to improve…” and you can see quite clearly that this new move by Sprint is being intensely questioned. Wells Fargo analyst Jennifer Fritzche chimed in as well, saying that Sprint “needs to be solely focused on avoiding mistakes of the past, where network overhauls caused major disruptions in the network’s performance.”