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Sprint CEO Defends Company's Decision To Bet It All On the iPhone
zacharye writes "Sprint chief executive Dan Hesse is being watched closely by the company's board of directors, but the CEO has to answer to investors and subscribers as well. Last year in October, Hesse revealed that the company is placing a massive $15.5 billion bet on Apple's iPhone, and in a recent interview, Hesse defended the move, which has been criticized by a number of industry watchers. From the article: '“Subsidies are heavy for the iPhone. This is the reason why a high percentage of new customers is important,” Hesse said during the interview. “But iPhone customers have a lower level of churn and they actually use less data on average than a high-end 4G Android device. So from a cost point of view and a customer lifetime value perspective, they’re more profitable than the average smartphone customer.”'"
They pay more and use less? What a shocker! Who would have thought?
This is how you utilize a first post?
They are also more attractive and have great personalities
Soon as my contract is up I'm going back to a flip phone. Had an iPhone since they first came out, bought the 3gs, bought the 4, smart enough to realize the 4s was just more of the same, but with even more useless junk (Siri). Haven't touch my iPad in 2 weeks. It's too much and I've been working in tech since the early 90s, all I want now is simplicity.
Can he defend their WiMax flub? Can he defend contracting with a company that has a non-existant LTE solution?
Keep the Classic Slashdot.
The SprintUsers site had an interesting commentary regarding a recent WSJ article on Hesse:
http://www.sprintusers.com/could-hesse-lose-his-job
Today’s Wall Street Journal has a rare, insider-rich piece targeting Hesse. A betting man would say his own board of directors had a lot to do with the story. No, no one on the board is quoted directly. But the picture the WSJ paints is certainly a flattering one of an engaged, hands-on board. They are served well by this story.
You don’t see this sort of knifing when an exec is secure in his job. It usually means board members are trying to distance themselves from a CEO’s plans gone wrong so they don’t get personally sued by shareholders. Or they’re getting ready to fire him.
Just last month, Sprint made an abortive attempt at a merger with MetroPCS, which was championed by Hesse but ultimately shot-down by the board. I have a feeling the company is going to experience a coup d'etat any day now. Well, whatever -- as long as my legacy SERO plan keeps working.
Ignore everything he says to justify iPhone on Sprint, what Sprint really wants is to get in on the Apple party.
As a Sprint customer with an Android 4G phone (but no 4G service in my area, and I pay $10/month for it), I really would rather that they spend that pile of money on building out their network. Sure, they're going to roll out LTE over the next couple years, but my phone isn't LTE. Dammit. And my city will be among the last to get Sprint LTE.
In the one corner Apple, in the other such winners as HTC, Motorolla, Nokia and Sony Ericsson. CEO's always get fired if they back the wrong horse, but he picked the one with the right odds.
If all else fails, immortality can always be assured by spectacular error.
I recently canceled Sprint and paid the ETF to do so. That's after having Sprint for nearly 10 years. I got an iPhone 4S with Straight Talk ( MVNO that uses AT&T's network). Why? Because I wanted a data service that works. With Sprint, I was frequently on 1X. Even when I was on 3G, the speeds were crap. Sprint bit off more than they can chew with the iPhone. WiMax was a bust. Nextel customers are leaving in droves and their Network Vision plan may well be the final nail in the coffin.
Wow, that's kind of depressing. I don't own a smartphone, but I work on them, and the world is a better place when there are more platforms to choose from. This is why I also hope the Blackberry Playbook survives too.
"First they came for the slanderers and i said nothing."
If you wany an apples to apples comparison, you should, at the very least, compare mobile web traffic from iOS to mobile web traffic from high-end 4G Android device - which is what the CEO was talking. And no one seems to ever announce this sort of data.
Stop with the fanboism. Seriously.
This is how you utilize a first post?
What a waste.
.Net. It sounds like Mr. Hesse is actually doing that.
Now, when it comes to the topic at hand: Bill Gates and Steve Ballmer were fond of using the phrase "bet the company" on certain initiatives, such as
The higher the technology, the sharper that two-edged sword.
Totally forgot about RIM, but then who hasn't ;-)
If all else fails, immortality can always be assured by spectacular error.
A contrived negative Apple comment. Who would have thought?
Dude, the GP just defined Apple's entire business model. Seriously, that's it in a nutshell.
Furthermore, like it or not, Apple is deserving of much approbation, far more than they get on this site.
The higher the technology, the sharper that two-edged sword.
Same as others have already posted long time sprint user paid the early termination fee. Tired of waiting for them to get their act together. Bad decisions constantly....... Never using the money to upgrade their network properly. Funny thing is he talks about 4g that most people can't get on sprint and the iPhone isn't even 4g so its a bad comparison shows he is a fool. Get out while you can its a sinking ship...
They earn a lot though, eh?
Help stamp out iliturcy.
Not sure about anyone else but they will be loosing me as a customer.
Sprint just raised prices mid-contract (only $5/mo but it could have been $1000 from the terms of the contract). When I called to get clarification they pointed me to the clause in the contract that says this: "We may change any part of the Agreement at any time, including, but not limited to, rates, charges, how we calculate charges, discounts, coverage, technologies used to provide services, or your terms of Service." They then will give you 30 days from the time of first notice (which is made on page 4 of the bill 30 days before the price is raised so by the time you see the price change you are already passed the 30 days) to drop Sprint if you wish. Of course that means sending back the $200 phone I paid for and getting nothing in return (no return charge and no phone). Basically this says is I am stuck with the agreement but really get nothing from it. They can change the price, length of contract, anything at any time and if I make changes then I get an early termination fee.
The long and short is I am stuck with Sprint but will be moving away from them upon contract end and will never go back. I don't like to do business with companies that operate like this. I read the contract before but somehow must have missed this gem of a clause. I won't make that mistake again. It may be just me but any company that would ask the customers to sign something like this is no company I want to be doing business with. For the customer you are basically agreeing to pay an unknown amount if you quite (they can change that too you know) for an unknown amount of time at an unknown price. The simple fact that they have not raised you monthly rate to $1000/month and extended you term to 10 years with a $5000 ETF does not mean they legally can not. To sign something like this is simply foolish IMO. A mistake I do not intend to repeat.
The fact that this price raise might be to cover new iphone subsidies just adds insult to injury. Next time I will buy my phone outright and use only prepaid services. The terms of service for all carriers are much too long to even bother with. Just another way that U.S. business is at a disadvantage compared to many other countries.
What I don't get is why iFanbois have such a hard time accepting a HELL of a lot of their buzz is branding and marketing. Not saying they don't build good products, because they do, but while Air Jordan is a nice shoe it ain't the leather that causes fistfights on release day, its the brand. Hell be happy, your favorite company has a brand like Prada and Porsche that people will pay assraping prices for that half eaten Apple logo.
Jobs spent most of his life devoted to building that brand into one of the most recognizable on the planet, right up there with Coca Cola and Disney so just accept it, okay? I mean you don't see Ferrari owners going "Waah but its a good value for the money waah!" because guess what? its not. Its a bad ass uberpowerful exotic which you are damned well gonna pay for that power and just because the telecos are willing to eat billions in subsidies in the hopes of using an Apple device to lock customers into multiyear contracts so that Joe the plumber can have an iPhone doesn't magically make them priced for the masses, it just means the cost of the actual device is hidden.
but in the end it all comes down to branding and I sincerely doubt you'd see the lines or selling out you see with something like the iPad if it weren't for every celeb on the planet being seen with one. Apple is "hip" and "cool" and "THE" thing to have so people want one. Jobs spent years building that up and to just ignore it ignores the man's life's work. Is that REALLY what you want to do? To belittle what was arguably one of the best marketing men in history? Give the man the credit he is due folks, by the time the man checked out his company was the most wealthy on the planet and his products went from being at death's door and looked down upon when he came back to being THE elite brand and the man was able to do that in less than a decade. give the guy his props.
ACs don't waste your time replying, your posts are never seen by me.
You have some points, but, at the end of the day, it comes down to performance. For me, anyway.
I'm the kind of guy who is fine riding around on an old, rusty 10-speed, instead of a tricked out high-end carbon-fiber bike. I also don't indulge in expensive riding apparel; I have proper cycling shoes - energy transfer benefit - but a shirt is pretty much a shirt. I drive a modest car instead of a high-end Audi, Beemer, Mercedes, etc. I have a modest house rather than a McMansion.
My laptop is a MacBook Pro - but not the 17"-er. I don't even consider it "indulging," either. This machine and the OS combined provide me the best experience and environment for doing my thing, whatever that is at the moment: video production; writing code; mixing music tracks; surfing the web; managing projects; writing documentation; email; etc. It does exactly what I want in almost all cases, and the frustration level is near 0.
I manage and have daily access to Solaris boxes, Linux boxes, Windows servers, etc. But for my daily use, it's a Mac.
If there was nothing useful behind the "shiny," Apple wouldn't last long.