Recent news reports suggest that Sprint is looking into the possibility of buying out rival wireless carrier T-Mobile. On one hand, this is a possibly strategic merger between the number three and number four wireless carriers. Even with the buyout, Sprint would remain the number three carrier beyond the much bigger Verizon and AT&T. On the other hand, this is a desperate move for Sprint whose strategic vision ended up being hopelessly flawed.
Several years ago, Sprint bought out Nextel. The idea then, as it is now, was that two smaller carriers could join forces to compete with the bigger carriers. The only problem is that it didn’t work. Sprint backed the wrong horse in the 4G technology race and wasted valuable time deciding what to do with Nextel’s network and spectrum. By the time it realized that it was leaps and bounds behind the bigger carriers, it was too late.
Now, Sprint has barely begun to roll out 4G coverage in the biggest markets, and there are plenty of markets where it hasn’t deployed any 4G at all. My home town of Denver, Colorado is case in point. Denver is the 23rd biggest city, and the 21st biggest metropolitan area in the US, but Sprint’s 4G coverage is nowhere to be found. The constant drumbeat of “it’s coming, but there are no dates,” has grown old and customers whose contracts come up tend to jump ship.
Why Sprint’s 4G Failure Matters
Just a few years ago, there were plenty of wireless customers who didn’t really care much about 4G coverage. Sure, those who cared about cutting edge technology were already there, but the iPhone didn’t even have 4G until 2012. Today, however, 4G is everywhere, and Sprint’s lack thereof in major metropolitan areas is a growing embarrassment.
The biggest issue is that even non-techies are now very aware that 4G means faster. Sprint’s only real hope for customers buying new phones is inertia. That is, that customers who already have Sprint service will just buy a new Sprint phone without asking about 4G, but even that possibility is fading fast. New services like the NFL’s highly touted “Football on Your Phone” are abysmal, if non-functioning, on Sprint’s slow 3G network. The same is true for any Comcast, HBO, or other video service on Sprint’s network. Once a customer sees those services on other phones, it is only natural for them to assume that there is something “wrong” with their service.
The catch is that you can’t just flip a switch and go 4G. Sprint has to switch out its old equipment to get 4G signals. The worst part is that it is taking down parts of its 3G network to do so. That means that not only to Sprint customers not have 4G, the 3G network they do have is actively getting worse.
All this brings us to Sprint’s desperate bid for T-Mobile. T Mobile has 4G networks in some of the same areas that Sprint is missing them. Ironically, however, they aren’t the same networks or the same equipment meaning that until the merger goes through, and until customers buy new phones, they will just get the same old, same old from Sprint.
How bad is Sprint’s position these days?
Well, I have an employee plan from way back in the day that adds up to approximately one-half the monthly cost of the other carriers for unlimited data and voice. I’ve told my wife that there is no way we are switching. I even bought new Sprint Galaxy 4S phones for both of us last fall, even though I knew Sprint didn’t have 4G in Denver. After all, I figured, the company dies more every day it doesn’t have those speeds, they have to be coming soon, right?
However, if I don’t have 4G in Denver by this Spring, I think I’ll take T-Mobile up on its offer to get me out of my contract and go over to them instead. Of course, I can’t do this if Sprint buys up T-Mobile. Me and the millions thinking the same thing are the reason Sprint needs to buy T-Mobile, and to do it fast. Everyone else has already deserted for ATT or Verizon at this point.
Otherwise, Sprint is headed for life as the low-tier carrier for folks who still just want a flip-phone.
(Or, of course, it could actually start lighting up 4G networks in bigger cities instead of trying to pad its numbers by rolling out dozens of smaller communities every three months in big press releases designed to show that it is moving forward more quickly than it actually is.)