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Sprint Reaches for Greater Speeds

Sprint Reaches for Greater Speeds
October 30, 2013 9:39AM

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We are in the very early stages of turning up the speed in community after community. This will be one of the important keys to success. It's great that Sprint is saying it's heading in that direction. That’s the good news. The bad news: AT&T, Verizon, and T-Mobile will be there as well, said analyst Jeff Kagan.

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Despite losing customers, Sprint posted encouraging third quarter earnings this week. In fact, the wireless carrier drove its best-ever postpaid service revenue at $5.8 billion. Now, the company will work to win more customers with new speed initiatives and devices.

Sprint is readying to demo the future of its wireless network on Wednesday. According to the Wall Street Journal, Sprint is holding an event for a small group of investors, analysts and journalists in Silicon Valley to show off how it can use its high-frequency spectrum to offer faster service.

Sprint also promised to offer a sneak peak at new devices that can operate on the network, handling videos and other data-intensive apps, the Journal reported. The news comes just a day after Sprint rolled out its 4G LTE service in 45 more markets. You might say the wireless carrier is moving fast since the Softbank acquisition.

Selling Speed

We asked Jeff Kagan, a telecom industry analyst, for his take on the first glimpse of the new-look Sprint. He told us he’s been waiting to see how the company would morph under Softbank and now we have one clue: faster speeds and new devices.

“AT&T and Verizon have roughly 70 percent of the marketplace. Sprint and T-Mobile are number three and four and have been struggling for growth in recent years,” Kagan said. “Sprint is showing off what may become one of their key strengths when they are eventually ready for market, and that is speed.”

Of course, Sprint is hardly alone in the speed game. Kagan noted that speed is emerging as one of the key ingredients of future success for both wireline and wireless companies. Google Fiber got the speed ball rolling in Kansas City and AT&T picked it up in Austin, Texas. Meanwhile, C Spire Wireless is pushing forward with high speed efforts in the Mississippi area.

Good News, Bad News

“We are in the very early stages of turning up the speed in community after community. This will be one of the important keys to success going forward,” Kagan said. “I am happy to see Sprint saying they are heading in that direction. That’s the good news.”

However, he added, the bad news is that by the time Sprint gets there competitors will be right alongside it. In other words, the competition will continue to be fierce as wireless and wireline carriers rush to more speed. Sprint doesn’t seem to have any particular advantage.

“The question is will Softbank change Sprint to be a stronger competitor in new ways, or will Sprint remain a quiet third place competitor? We’ll have to wait and see,” Kagan said. “This high speed show off is good, but it does not answer that question yet.”

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