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The long wait seems about to be over for Sprint (NYSE: S ) investors, as the nation’s third largest wireless carrier announced a July 15 launch date for rolling out its next-generation Long Term Evolution (LTE) technology-based network standard across five cities. The only question on everyone’s mind at the moment should be: Is it already too late for Sprint to catch up with larger rivals Verizon (NYSE: VZ ) and AT&T (NYSE: T ) , and break into their joint stranglehold over the wireless carrier space? Time to give you a clearer picture.
What seems to be the prime concern is the fact that the gap between Sprint and the other two is quite big, with Verizon’s LTE network covering 304 cities compared to AT&T’s 41. Incidentally, Verizon is 18 months ahead of Sprint in setting up the LTE network, and AT&T is staying around 10 months ahead. Sprint deserves admiration for remaining optimistic about its prospects in this situation, which has been made all the more difficult by the fact that it has posted five consecutive years of losses.
These are not the only reasons why Sprint needs to speed up. The company is already actively selling next generation LTE-enabled smartphones, such as the Samsung Galaxy S III, but it doesn’t have a matching network to offer its customers. The problem will inevitably become more intense because the Apple iPhone is almost sure to have LTE capabilities. Keeping these factors in perspective, the July 15 launch seems to have come at just about the right time.
Sprint has already suffered heavy customer erosion – it’s lost around 192,000 contract customers as it’s gearing up to shut down its outdated Nextel network. That data in itself is quite scary for a company that has already committed to Apple (Nasdaq: AAPL ) to sell around $15.5 billion worth of iPhones over the next four years. At the same time, Sprint knows that this is a make-or-break situation, as it plans to spend a whopping $10 billion on network expansion efforts. This is one company I would be keeping a close watch on, and you can also do the same by adding Sprint to your very own free watchlist.
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