There has been lots of speculation about why Sprint opted out of the upcoming wireless spectrum auction. I have received loads of questions from reporters, investors, workers and customers. However, very few actually understand. Is this a sign of strength or weakness? Let me share a few thoughts on why I believe Sprint is doing this and what the results will be.
It’s well known that wireless spectrum is limited and most carriers are concerned about having enough to give their customers the ability to access their network with all their wireless devices. What is less known is that Sprint currently has plenty of wireless spectrum. The carrier got it from a variety of places in the last several years, including its Clearwire acquisition.
Sprint’s choice
Sprint has a choice to make. It is still in the recovery and rebuilding mode. It can either spend billions buying spectrum it won’t need or use for many years, or it can spend that time and money more rapidly rebuilding its network and improving customer satisfaction today.
The choice Sprint made is to focus on the recovery and rebuild, and keep customers happy today. It has done quite a good job of improving quality and customer satisfaction in many market areas around the country according to survey companies like RootMetrics and J.D. Power. In fact, Sprint is now No. 1 in a few markets and is building from there. The carrier is making progress.
With that said, every company has limited resources. They can’t do everything they want all at once. No company can. A choice had to be made at Sprint. It could either spend time and billions to acquire more spectrum not needed for years, or it could focus on improving its service and customer satisfaction today. Sprint chose today.
Did Sprint make the right call?
I think Sprint made the right call. Bottom line, a carrier needs to remain relevant and needs to continue to build market share. Sprint can do this by focusing on continuing to improve the customer experience, which is done by focusing on the network and customer satisfaction, not by buying more spectrum they won’t need for years.
Would it have been better if Sprint could do both? Of course it would, but that is not an option for any competitor. No company can do everything it wants all at one time. It must create a list and do things in order. Important things take money, brainpower and manpower, and since no company has these in unlimited supply choices have to be made.
The right choice
So if Sprint had to make a choice like every other company, I think it made the right choice. Now it has to continue on the same recovery and rebuilding path, continuing to get better and stronger, quarter after quarter.
I have been watching Sprint closely for decades. The carrier fell off the growth curve a decade ago, however, during the last couple years it has recovered and been heading in the right direction for growth. Over the next several years Sprint will be focused on recovery and growth. If this continues, I think this decision will be recognized as the right call.
