Sprint promises higher data speeds than rivals
BURLINGAME, California (Reuters) - Sprint Corp (S.N) promised to gradually offer wireless data speeds far in excess of those offered by bigger rivals like Verizon, as it hopes to use recently acquired wireless airwaves to regain market share.
At its research labs on the outskirts of San Francisco, Sprint on Wednesday outlined plans to expand Spark, a service it is now building with speeds of 50-60 megabits per second, which is being rolled out initially in five cities: Los Angeles, Tampa, Miami, Chicago and New York.
In comparison, Verizon Wireless (VZ.N)(VOD.L) says it provides customers data speeds of 5-12 megabits per second but its high-speed network covers 303 million people.
After losing subscribers for years, No. 3 U.S. mobile service provider Sprint is looking to distinguish itself from rivals AT&T Inc (T.N), Verizon Wireless and T-Mobile US (TMUS.N), which are ahead of it in high-speed upgrades.
"Sprint has a much broader set of spectrum in more markets than their competitors," said Andy Castonguay, principal analyst at Machina Research. "Their spectrum holdings give them a unique advantage."
But he cautioned a lot of Sprint's plans seemed theoretical for the moment and the industry has to see the technology in action to understand the impact on the consumer. With rapidly increasing bandwidth, other issues such as power consumption, battery life and heat will come to the fore.
"It's going to push the boundaries of power consumption and antenna design. It's going to be very interesting to watch the next generation of devices," he said.
Sprint demonstrated to reporters at its Burlingame labs ultra-fast wireless data speeds of 1 gigabits per second, about 16 times faster than its current peak speeds and rivaling the fastest wireline speeds.
It also showed off potential applications of ultra high-speed wireless, from online multiplayer gaming to simultaneous streams of video based on next-generation "4K" TV technology.
AT&T shrugged off Sprint's claims but declined to comment on its own speeds.
"A demo counts as much as making a touchdown with no other players on the field," AT&T spokesman Mark Siegel said.
AWAITING SPRINT'S PLANS
Sprint has tried to win back customers through initiatives such as plans that offer unlimited data for life. On Wednesday it posted a decline in third-quarter revenue after losing more subscribers than expected following the shutdown of its older network.
Investors have been anxious to see what Sprint, which is 80 percent-owned by Japan's SoftBank Corp (9984.T), would do with its partner's financial backing and the experience of Softbank founder Masayoshi Son, who was able to quickly turn around his own company's mobile business.
They are also anxious to hear how much network upgrades would cost. The company said it would provide capital spending details when it reports fourth-quarter results.
Sprint's plans include antennas that use 8 transmitters and receivers versus the current 2-plus, devices capable of handling tri-band frequencies and employing its spectrum range to achieve peak speeds of up to 150 to 180 mbps by late 2015.
Softbank has expertise in this area that will come in handy, Sprint CEO Dan Hesse told reporters in Burlingame. And it plans to use the latest technology and airwaves from its buyout of Clearwire Corp to boost its network capacity.
"We paid a lot of money for Clearwire and that spectrum. We did it because the 800 frequencies were so valuable that if you could put it all together ..., the whole is greater than the sum of the parts."
The company said it plans to deploy Sprint Spark in about 100 of America's largest cities during the next three years.
Sprint expects 100 million people in the United States will have Sprint Spark by the end of 2014.
It said that its high-speed service based on Long Term Evolution (LTE) technology will be available to about 250 million people by mid-2014, compared with its 200 million target for the end of 2013.
Sprint said the first devices that work on both its own existing spectrum and Clearwire's spectrum will go on sale in early November from HTC Corp (2498.TW), LG Electronics (066570.KS) and Samsung Electronics (005930.KS).
Alcatel Lucent (ALUA.PA) and Nokia (NOK1V.HE) said they are helping Sprint with its network upgrade.
Sprint shares closed up 25 cents or almost 4 percent at $6.93 on the New York Stock Exchange after the news.
(Reporting by Sinead Carew in Kinsale, Ireland, and Edwin Chan in San Francisco; Editing by Phil Berlowitz)