Yesterday, 7:23 PM
- Wells Fargo has picked its winners in March's FCC broadcast incentive auction for wireless spectrum -- and it figures AT&T (T +0.2%) will dominate bidding that should total $30B-$35B.
- Analysts at the bank predict up to $10B spending coming from the telecom giant for a nationwide block of 2x10 MHz airwaves.
- T-Mobile (TMUS -3.7%) -- which has been signaling aggressive moves in the auction -- will be second, with $8B spent, the analysts said, while Verizon (VZ -0.6%) should be last with $5B in bids. Sprint (S -1.8%) has already said it's sitting this one out.
- While AT&T backtracked a bit on pledges to spend $9B while it was digesting DirecTV (NASDAQ:DTV), the analysts think the benefits of a nationwide block may signal higher spending from the company.
- Verizon, meanwhile, has credit to spend up to $10B, but probably won't: "Similar to what T has said publicly and based on our conversations with spectrum experts, we look for VZ to contribute in a meaningful way if 2x10MHz bands are made available."
- Previously: T-Mobile -2.2% as it pledges $200 for each Sprint line that switches (Nov. 25 2015)
- Previously: SoftBank spending: Arora on investment universe, Sprint worries (Nov. 24 2015)
Yesterday, 10:20 AM
- It's been nearly straight down out of the open for T-Mobile (NASDAQ:TMUS), down 2.2% after it announced a special "holiday gift" for Sprint (S -0.5%) customers: $200 to switch carriers.
- That's on top of the up to $650 T-Mobile is offering to cover early termination fees and phone payment balances, and it's $200 for each line switched.
- "I cannot think of any wireless customers in more desperate need of some holiday cheer than those Sprint customers still hanging on over there," said T-Mobile CEO John Legere. "Those poor people have put up with the nation's slowest and smallest LTE network, and their carrier throwing out a deal-of-the-month for everyone except them."
- The deal includes switching any Sprint number (postpaid, prepaid, Boost or Virgin Mobile) to a T-Mobile Simple Choice postpaid plan. It's effective starting Thursday.
- Legere promised additional "gifts" coming to Verizon and AT&T customers over the next few weeks.
Tue, Nov. 24, 7:52 PM
- SoftBank (OTCPK:SFTBY -1.6%) last month declared a plan to spread "several billions" each year in investments around the world, all set to be managed by president (and likely successor to Chairman Masayoshi Son) Nikesh Arora -- who certainly seems to prefer options in India over pouring more money into struggling Sprint (S +0.9%).
- In an interview with Bloomberg on his strategy, Arora says that while they're focusing on later-stage startups with proven products, there's "money to be made in any stage, as long as you identify the right company."
- While there are some 150 companies valued over $1B, Arora says there are about 1,000 companies over $500M: "That’s our universe. We believe with 1,000 companies we can interpret this universe and understand it with limited resources."
- He says the best thing they can offer startups is "operational insights," rather than investment strategy or fund-raising help.
- As for SoftBank trading at a discount to public assets: "There are three things that people worry about. One is what’s going to happen to Sprint. Two is what’s going on in China. And three is I hope Masa won’t do another Sprint." But as for Sprint, "Masa is unrelenting. He is working with [Sprint managers] almost every night for a few hours, 10 p.m. calls, or in the morning."
- Previously: SoftBank planning "several billions" in annual global investment (Oct. 22 2015)
- Previously: Sprint to target 'bloated' structure with $2.5B in cost cuts (Oct. 09 2015)
Fri, Nov. 20, 8:00 AM
- Sprint (NYSE:S) -5% premarket following the announcement of $1.2B sale-leaseback plan.
- Under the plan, a group of investors including Sprint (S) majority owner Softbank (OTCPK:SFTBF, OTCPK:SFTBY) will create a $1.2B into an entity to purchase the devices Sprint leases to customers.
- Sprint will then lease back the devices from the new venture, giving it fresh funding "at an attractive cost of capital which is well below Sprint's alternatives in the high-yield debt market."
- "Providing mobile devices to customers is the biggest use of cash in the carrier model, and with this new structure we have more closely aligned Sprint's cash flows with those associated with leasing devices to our customers," CFO Tarek Robbiati says.
- The move will boost free cash flow, but reduce 2015 Ebitda by ~$400M.
- Related: Sprint: Cost Cutting Is A Sign Of Desperation (Oct. 9)
Wed, Nov. 18, 11:54 AM
- Sprint's countdown is over, and its latest promotional pricing in a fierce wireless war looks a lot like its move last December.
- Back then, Sprint (NYSE:S) pushed "Cut Your Bill in Half." Now Sprint is offering switchers 50% off most rival plans for those who come to Sprint between Friday and Jan. 7, along with up to $650/line in switching fees. The discounts last until 2018.
- Shares have tumbled on the move, down 4% today.
- Marcelo Claure also tweeted out a reward for existing customers: "A free tablet and 1 year of free service! While supplies last." Details on that offer are light, but Claure may fill it in with a news conference later today.
- There's a fair amount of fine print; Sprint is charging $36/line in activation fees (Verizon just reinstated $20 activation fees, while AT&T still has $45 fees for some contract plans) and the 50% off doesn't apply to a chunk of the bill, like taxes, surcharges, and premium content.
- Previously: Sprint teasing 'serious savings' in announcement (Nov. 18 2015)
- Previously: Sprint restructuring: Four regional hubs, uniting sales channels (Nov. 13 2015)
Fri, Nov. 13, 6:49 PM
- Along with a price hike for its unlimited wireless phone plans on Sunday, Verizon (VZ -1.3%) is bringing back activation fees, instituting a $20 charge for new lines of service.
- The carrier had waived the fees just a few months ago when it abandoned phone subsidies and service contracts; they were $40 at the time for customers who signed two-year deals.
- AT&T (T -1.1%) charges a $15 fee for devices sold through its installment program, or $45 for a two-year contract or purchased device.
- Verizon is raising the price of its unlimited data plan by $20/month on Sunday, a move in line with recent ones by its competitors. Sprint (S +0.7%) raised its own unlimited data plan by $10/month at the end of September.
- At least Verizon waited until after T-Mobile's (TMUS +2%) "Un-carrier X" event to drop the news; T-Mo's John Legere is fond of lambasting competitors for broad line activation charges, though every carrier has one somewhere.
Tue, Nov. 3, 9:14 AM
Tue, Nov. 3, 8:53 AM
- Sprint (NYSE:S) is 8.1% lower premarket after fiscal Q2 results where it indeed returned to positive net additions in postpaid phone subscribers, but declining revenue disappointed, as did a net loss that didn't narrow as much as hoped.
- Net loss was $585M compared to a year-ago $765M. Revenues were off nearly 6%, though wireless service revenues plus installment plan billings and lease revenue of $7.1B was up slightly Y/Y.
- Adjusted EBITDA of $2.008B beat an expected $1.967B.
- Postpaid phone net added subscribers was 237,000, the first quarterly additions in years; that number includes 199,000 prepaid-to-postpaid migrations for a true new-subscriber number of about 38,000 (538,000 better than last year).
- Sprint platform postpaid net additions were 553,000, compared to a year-ago net loss of 272,000; total net additions were 1.1M vs. a year-ago 590,000.
- Revenue by segment: Service revenue, $6.88B (down 7.6%); equipment revenue, $1.095B (up 5.3%).
- The carrier is guiding for full-year EBITDA to be at the low end of the previous range of $7.2B-$7.6B, and full-year cash capex of about $5B, excluding impact of leased devices sold through indirect channels.
- Press release
Mon, Nov. 2, 6:10 PM
- Sprint (S +2.9%) and Cuba's state telecommunications firm Empresa de Telecomunicaciones de Cuba -- Etecsa -- have signed a roaming deal that's the first direct deal of that kind between phone companies in the two countries.
- With the deal, Sprint subscribers visiting Cuba can send and receive calls and texts directly through Etecsa, which monopolizes telecom service in the country.
- Verizon began offering the first roaming service in Cuba in September, but that service has to go through third parties. Earlier this year, Sprint's prepaid Boost Mobile service launched a prepaid plan for calling Cuba that it targeted at Cuban-American core Miami.
- With increasing liberalization, Cuba's phone market could become the largest in the Caribbean, as mobile phone penetration is low in a population of 11M.
- After solid gains today, Sprint has given some back after hours, -1.1%.
Mon, Nov. 2, 12:29 PM
- After a cavalcade of recent customer-focused initiatives, Sprint (NYSE:S) is expected to add postpaid phone subscribers for the first time since Q4 2010 when it reports fiscal Q2 earnings tomorrow morning.
- And that should lead to a narrower loss even if revenue slips as expected. Consensus expectations are for Sprint to post revenues of $8.1B, down 4% from the prior year's $8.49B, and an EPS of -$0.07 compared to 2014's -$0.12.
- Sprint shares are up 2.5% today, a rebound from a couple of market days where the stock declined 5.6%.
- Oppenheimer's Tim Horan sees a "modest level of phone net adds (perhaps in the 200,000 range)," and while he expects it's a long-term underperformer, "for this upcoming quarter, the positive phone net adds, lease accounting benefits and new financing could benefit the stock."
- Pacific Crest's Michael Bowen sees postpaid phone net adds of 45,000: "We expect Sprint to provide additional color on the formation of its leasing company and on its network strategy. In addition, we expect to hear more concrete plans regarding Sprint's recent cost-cutting initiatives."
- A plan to cut $2.5B in costs that CFO Tarek Robbiati laid out last month has begun to get under way with such new moves as slashing severance pay and cutting free water and yogurt at HQ.
- Previously: Sprint Chairman Son buys Kansas City home near CEO Claure (Oct. 30 2015)
Thu, Oct. 29, 3:27 PM
- Sprint (S -5.1%) has yet another revision to its plans, offering a "starter unlimited data" plan that includes 1 GB of high-speed data plus unlimited (2G, slow-speed) data for $20/month.
- The offering launches tomorrow and can be tied to a $20/month unlimited talk/text plan along with Sprint Global Roaming.
- As previously reported, Sprint kicked up the price of its true unlimited plan to $70/month. That plan offers unlimited high-speed data plus 3 GB of mobile hotspot usage along with Global Roaming. Additional lines on that plan are $60/month each.
- The starter-plan participants will be able to buy additional chunks of high-speed data as needed but won't face overages for unlimited use of the 2G-speed data.
Mon, Oct. 26, 3:49 PM
- Sprint (S +1.6%) is cutting severance pay in half -- which may be presaging more layoffs amid the company's latest round of cost controls.
- The company is cutting severance pay to one week of pay per year worked at Sprint, from the previous two, for employees notified after Jan. 30 of their layoff.
- Last fall about this time, Sprint cut 458 employees. The company is in the middle of a new cost-cutting push, with CFO Tarek Robbiati vowing it will cut $2.5B from a "bloated" structure.
- Previously: Sprint to target 'bloated' structure with $2.5B in cost cuts (Oct. 09 2015)
Thu, Oct. 22, 2:25 PM
- SoftBank (OTCPK:SFTBY +1.6%) gave some more visibility on planned investments as Chairman Masayoshi Son said the company will spread "several billions" of dollars each year around the world as part of its evolution into a true global enterprise.
- There's particular interest in India, Son says. In a streamed conversation with likely successor and company president Nikesh Arora, Son said the company will seek out passionate entrepreneurs in the right markets, like Jack Ma (SoftBank's stake in Alibaba is more than 30%).
- Arora had made a "personal bet" on SoftBank this summer by pledging to buy nearly half a billion dollars worth of its stock, and he's been a big proponent of investments in India -- possibly to the detriment of struggling Sprint (S +0.8%). SoftBank increased its ownership in Sprint to 83% last month but has said it wouldn't go above 85%.
- Previously: SoftBank up 4.4% on Arora's multimillion-dollar 'personal bet' (Aug. 19 2015)
Tue, Oct. 20, 11:32 AM
- Sprint (S -1.7%) hits a legal setback as it fails in a bid to dismiss a $300M fraud lawsuit filed by New York State over billing for wireless service taxes.
- The state used whistleblower information to charge the company with failing to collect more than $100M in taxes from New York customers, in violation of a 2002 state law imposing those taxes on interstate services.
- Sprint had claimed that law was unconstitutional, but the state's Court of Appeals rejected that contention in a 4-1 decision.
- The state's attorney general is seeking to treble the $100M tax collection in damages and penalties.
Fri, Oct. 16, 5:41 PM
Fri, Oct. 16, 5:07 PM
- The FCC is probing four companies -- AT&T (T +1%), Verizon (VZ +0.1%), CenturyLink (CTL -0.7%) and Frontier Communications (FTR -1.9%) -- over terms they set for business broadband, the dedicated mission-critical lines that make everything from schools to ATMs work.
- That's a $20B market, and competitors including Sprint (NYSE:S), Level 3 (NYSE:LVLT) and Cogent (NASDAQ:CCOI), along with Amazon.com and others, are complaining about unfair lock-ups with large early termination fees.
- The FCC has found "potentially unjust and unreasonable practices" that rise to the level of an investigation. It says the four companies it's probing use plans with “a complicated web of all-or-nothing bundling, loyalty and term commitments, complex enforcing penalties” and other provisions, and asked them to respond by Dec. 18.
- In a mailed statement, industry group USTelecom (of which the four companies are members) says the investigation is a "rear-view mirror" approach. “Although the FCC says that it wants to be a data-driven agency, promote facilities-based competition, and incent broadband investment, it just can’t seem to get beyond its telephone-era mindset when it comes to regulating 20th century legacy services," says USTelecom President Walter McCormick.
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