Sprint raises smartphone termination fee to $350 weeks before iPhone 5 launch

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Comments

  • Reply 21 of 34
    Quote:
    Originally Posted by Lancelot9201 View Post


    I'll just add this to the list of reasons I'd never do business with Sprint.

    Thank god they own the number of towers they do or they would have been gone

    long ago. Sprint is the epitome of a company who's CEO has zero understanding of a productive business model or understanding on how to implement one.

    I really wish that Google would get into the Broadband / Internet game. Google has the ability to put a good product to market using a fair pricing structure. I'm so sick of the weekly changes in terms, conditions & pricing that the big 3 constantly bombard us with, all of which just add money to their pockets while making us suffer.



    Ironic perhaps that once upon a time, it was Sprint PCS that didn't have the towers or build-out, and they were the outsiders putting the squeeze on established companies operating analog cell networks (this in the early 90s). Sprint had advanced (at the time) CDMA phones that ran rings around clunky analog cell phones, and since it was all digital, they could price things lower and throw in long distance for one low price. There wasn't even a termination fee because you didn't sign a contract with Sprint: all plans were no-contract plans. WTF happened in the last 15 years? Sprint became the very thing they were once upon a time the antithesis of.



    I don't regret leaving Sprint for one second. The iPhone ain't gonna get me back there.
  • Reply 22 of 34
    Quote:
    Originally Posted by gwmac View Post


    I think you meant using voice and data at the same time instead of multitasking. Yes, you can do that now with any LTE phone on Verizon or WiMax phone on Sprint, and any phone on WiFi for data. Sprint is upgrading their CDMA to 1X advanced and I believe so is Verizon. That would allow voice and data simultaneously over CDMA.



    There are plenty of world phones on all carriers. So that is false. My old HTC Touch Pro 2 on Sprint even had a SIM slot and could be used in GSM countries abroad.



    Thank you, I appreciate the answers.
  • Reply 23 of 34
    mennomenno Posts: 854member
    No, the reason they raised their ETF is that they saw Verizon and AT&T do it without it having a serious impact on Churn (or people signing up without contracts). The only other major player is T-Mobile, but ETF's are proving to be not that big of a deal for carriers since most people might complain about it, but they sign anyway.



    People canceling contracts is a very low % of overall customers, but it can add up really fast with subsidies. Let's say a carrier has 40 million customers and a churn rate of 1.5%. That's still 600,000 people cancelling. Modern smartphones are subsidized more than ever. An Iphone 4 is what? 199? Get that same phone off contract (on Verizon) it will cost you $649. That is subsidy of $450 PER PHONE.



    Now, the amount of the subsidy will vary depending on the phone sold, but for smartphone's it's generally around the 300-400 mark. There is a little markup with the devices, but it's not as high as everyone things. For verizon, the markup online/corp stores is around $20, while some 3rd parties can have a higher markup, the fact remains that MOST of the markup is done by the manufacturer. This is why Apple, HTC, and Samsung are all making so much money with smart phones. Their revenue AND their profits are increasing.



    How most carriers work subsidies is they amortize the cost over the term of the contract (most carriers do 20 months before upgrade). So while you might be paying them $100 a month in service costs, only a portion of that is going to pay for the phone. The rest is the services you use, paying the wages for customer service, support techs, etc. and investing in future tech (such as LTE). Yes, there is also profit figured in there, but companies need to make a profit, or they don't stay in business. Apple understands this better than anyone.



    So let's take that 600,000 again. With the old ETF (175 for verizon), that would be a loss of 275 per churned customer, before amortization, or 165 Million dollars in additional lost revenue. After the change (350 etf) the loss drops to $100 per phone or $60 Million before amortization. But, the higher ETF also acts to inhibit churn so savings can be even greater.



    I'm not defending Telecom's pricing for plans, I think that they're too high just like everyone else. But as long as customers demand cheap phones, we're giving up our best bargaining chips for $450 savings over 2 years. And no company will eat millions in potential revenue if they don't have to.



    EDIT: I should also mention that (in part because of the price hike, in part because of Apple's Iphone pricing) most smartphones no longer have rebates with Verizon.
  • Reply 24 of 34
    Quote:
    Originally Posted by Lancelot9201 View Post


    I'll just add this to the list of reasons I'd never do business with Sprint.

    Thank god they own the number of towers they do or they would have been gone

    long ago. Sprint is the epitome of a company who's CEO has zero understanding of a productive business model or understanding on how to implement one.

    I really wish that Google would get into the Broadband / Internet game. Google has the ability to put a good product to market using a fair pricing structure. I'm so sick of the weekly changes in terms, conditions & pricing that the big 3 constantly bombard us with, all of which just add money to their pockets while making us suffer.



    What are you even talking about - did you read the article, where it says the other major carriers already have this fee structure?



    As for your silly comments about Google -- whatever. The "real name" debacle on Google+ -- deleting people's Gmail, Picasa, etc accounts just because they *think* (without even bothering to prove it) that someone's not using their real name on Google+ -- shows how Google's just another my-way-or-the-highway megacorp.
  • Reply 25 of 34
    Quote:
    Originally Posted by SpamSandwich View Post


    It sure would be nice if Apple stepped up and bought either T-mobile or Sprint (or both, for that matter)...



    Why would Apple want to buy a telco and suddenly have millions of people complaining about "my *Apple* service" and "my *Apple* coverage" every time they had a problem with their phone? What company (that already has a stellar, clean reputation) would want to take on that nightmare?
  • Reply 26 of 34
    gwmacgwmac Posts: 1,813member
    Quote:
    Originally Posted by Corrections View Post


    I haven't seen data from this year broken out, but a year ago AT&T was selling ~15 million iPhones while Verizon was selling about 7 million Blackberries and 7 million Android smartphones, while Tmobile and Sprint were each only selling less than 4 million smartphones of any flavor.



    So despite being about half the size of Vz and ATT, TMob and Sprint had a much lower smartphone mix than AT&T. Like Verizon, they want to grow their smartphone subscriber ratio and keep subscribers from churning. AT&T has largely been protected by the iPhone's attraction.



    I thought your chart looked way off and did a little digging. You were way off.I believe the exact opposite is true, that Sprint has a HIGHER proportion of smartphones. Here's one little quip:



    http://gigaom.com/2010/10/29/sprint-ceo-dan-hess/

    Quote:

    Hesse told me that in the most recent quarter, nearly 60 percent of devices sold (or upgraded) for use on their CDMA network were smartphones, and as of now, 45 percent of Sprint (excluding non-Sprint brands) customers have a smartphone. By the end of 2010, half of Sprint customers will have smartphones, he added, and quipped. “They are very mainstream.”





    "somewhere we'll find that Verizon, e.g. has something like 20-30% smartphones... here...

    http://www.twice.com/article/462934-...hone_Sales.php

    Quote:

    In the quarter (4Q2010), more than 75 percent of the carrier's 872,000 postpaid net new subscriber additions bought smartphones, helping bring the number of retail postpaid subscribers with smartphones to 26 percent of all retail postpaid users, up from a year-ago 15 percent.



    Originally Posted by Dan Hesse

    76% of Sprint-branded devices sold in the quarter were smartphones, bringing the smartphone percentage of our Sprint branded or CDMA customer base to 58%.



    http://seekingalpha.com/article/2826...all-transcript



    From August 2011

    http://www.androidpolice.com/2011/08...s-on-the-rise/

  • Reply 27 of 34
    mennomenno Posts: 854member
    Quote:
    Originally Posted by Sierrajeff View Post


    What are you even talking about - did you read the article, where it says the other major carriers already have this fee structure?



    As for your silly comments about Google -- whatever. The "real name" debacle on Google+ -- deleting people's Gmail, Picasa, etc accounts just because they *think* (without even bothering to prove it) that someone's not using their real name on Google+ -- shows how Google's just another my-way-or-the-highway megacorp.



    People's Gmail and Picasa are NOT deleted over the naming policy. this was explained what? 3 weeks ago? Longer? The only way this stuff is suspended is if the account is suspected of SPAMMING, or if the user is violating the TOS (such as being under 18. Which is illegal in the US because of data laws)



    Nice try.
  • Reply 28 of 34
    Quote:
    Originally Posted by Tallest Skil View Post


    Apple already sells an unlocked GSM iPhone to cover all GSM smallies.



    All they have to do is sell the iPhone 5 unlocked to cover everything.



    That is great for GSM phones -- but CDMA carriers typically don't work that way. And all carriers in the US other than AT&T & T-Mobile are CDMA carriers. (Not that I like that, but it is the way it is).
  • Reply 29 of 34
    Quote:
    Originally Posted by mac1972 View Post


    That is great for GSM phones -- but CDMA carriers typically don't work that way. And all carriers in the US other than AT&T & T-Mobile are CDMA carriers. (Not that I like that, but it is the way it is).



    Doesn't matter. LTE is SIM-based and Verizon, et. al. are moving to LTE. CDMA doesn't matter anymore.
  • Reply 30 of 34
    gwmacgwmac Posts: 1,813member
    Quote:
    Originally Posted by Tallest Skil View Post


    Doesn't matter. LTE is SIM-based and Verizon, et. al. are moving to LTE. CDMA doesn't matter anymore.



    CDMA will matter for quite a long time to come. VoLTE (voice over LTE) will not fully replace voice calls on Verizon until 2015 at the earliest and probably even longer than that. Why would Sprint and Verizon bother upgrading their CDMA to 1X advanced which allows simultaneous voice and data like GSM if it simply didn't matter. CDMA will still be important for several more years.
  • Reply 31 of 34
    Quote:
    Originally Posted by Tallest Skil View Post


    But they're both worthless… And don't serve any purpose for Apple to own.



    They have millions of customers and cell networks in place.
  • Reply 32 of 34
    Quote:
    Originally Posted by SpamSandwich View Post


    They have millions of customers and cell networks in place.



    That's meaningless in light of everything else Apple would be taking on by buying a telecom.
  • Reply 33 of 34
    Quote:
    Originally Posted by Tallest Skil View Post


    That's meaningless in light of everything else Apple would be taking on by buying a telecom.



  • Reply 34 of 34
    Quote:
    Originally Posted by SpamSandwich View Post






    You're acting as though it's as simple as signing a few sheets of paper and replacing a few storefront signs.



    First, that's exactly what it is. Signing papers. But there won't be any storefront signs replaced, the stores would close down. No more T-Mobile stores. Apple would handle iPhone sales from Apple Stores, meaning all those salesmen? Fired. Gone. Unneeded.



    Second, it's canceling all contracts and whatever else T-Mobile had with every other cell hardware manufacturer. Bunch of legal crap there, plenty of payoffs, and maybe some lawsuits.



    Third, it's building out T-Mobile's network to be something that's actually worth anything. Ever seen T-Mobile's coverage map? Plenty of places that don't even have voice that should. They don't differentiate between their data speeds on their data map (just one blob of pink), but I can't imagine them having their "4G" (note: HA HA HA HA HA HA HA) everywhere there IS pink.



    That's much of Apple's existing cash right there.



    On top of all this, then you have every other telecom on the planet that Apple DOESN'T own but with whom they have agreements BEING FRICKING TERRIFIED that Apple will stop letting them have the iPhone. They'll be hurt, betrayed, and afraid that they're next for the purchase.



    Apple having one carrier in one country is a whole mess of trouble.
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