Sprint CEO Defends Company's Decision To Bet It All On the iPhone 187
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.”'"
Re:Apple Customers (Score:3, Interesting)
It is a bit surprising. (But so too was the stat that the number of iPhone users (UK) in debt are about double that of Android users.) Maybe these persons don't buy the phone for actual use, but for the same reason I spent money on a watch that I didn't need -- it looks good on my wrist.
Re:Apple Customers (Score:5, Interesting)
They pay more and use less? What a shocker! Who would have thought?
It's not even that. What he's saying is that 4G Android users use more data than iPhone (i.e. 3G) users do (shocking!) since iPhone is currently still 3G/"3.5"G, and the Android users are more likely to demand the newest gadgets (i.e. "higher churn"). Which is naturally worse for the phone company who wants you to buy whatever phone, keep it forever, and never use the speed you're paying for while still continuing to pay for it.
The problem is that newer, 4G iPhones are likely to attract exactly the same crowd. So unless Sprint's new business model is to keep selling obsolete iPhones forever, they had probably better get a new plan.
Tired of smart phones (Score:2, Interesting)
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.
Re:Apple Customers (Score:4, Interesting)
Android has voice dictation too hasn't it ? Plus it has to serve up all those mobile ads, so it might still use more data though not to the user's benefit [bbc.co.uk].
Re:Apple Customers (Score:4, Interesting)
I have a 4S and use the same amount of data as I did with my 3G, which isn't much at all. Less than a gig per month.
I do use Siri as well, mostly when driving.
Re:Tired of smart phones (Score:3, Interesting)
I just want a basic feature phone with a long battery life, that has a 4G antennae and bluetooth in it so I can use it to tether whatever real computing device I want at need. 95% of the "smart" features on my phone I don't use anymore, because they've been replaced by the same features on my larger screened Android tablet, and I also tether my laptop from time to time when I need a connection and a real computer when I'm out and about. All my iPhone serves as anymore is basically an internet hot spot for either, and (*gasp*) I use it to make phone calls. I'd much rather have a battery that lasts a week of regular phone usage on a much smaller flip phone that fits easily in my pocket.
Sprint Board revolt (Score:5, Interesting)
The SprintUsers site had an interesting commentary regarding a recent WSJ article on Hesse:
http://www.sprintusers.com/could-hesse-lose-his-job [sprintusers.com]
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.
Re:Tired of smart phones (Score:4, Interesting)
Re:CEO Defends Decision To Bet It All On The iPhon (Score:5, Interesting)
In the one corner Apple [macrumors.com], in the other such winners as HTC [allthingsd.com], Motorolla [techcrunch.com], Nokia [cnet.com] and Sony Ericsson [engadget.com]. CEO's always get fired if they back the wrong horse, but he picked the one with the right odds.
Re:IRaped (Score:5, Interesting)
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
this is why i left (Score:3, Interesting)
Re:Apple Customers (Score:5, Interesting)
Re:Apple Customers (Score:3, Interesting)