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Sprint to bet the farm on a $20 billion Apple deal over the next 4 years, iPhone 5 exclusivity in tow?

Posted: , by Daniel P.

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Sprint to bet the farm on a $20 billion Apple deal over the next 4 years, iPhone 5 exclusivity in tow?
Wall Street Journal is reporting the staggering rumor that Sprint has locked itself into a deal with Apple to buy 30.5 million iPhones from it over the course of four years, which, at north of $600 ASP for the iPhone 4 in the last quarter, amounts to about $20 billion.

CEO Dan Hesse thinks that Sprint has a strong franchise and great customer service now, and only the lack of an iPhone version in its lineup is the reason behind customers defecting to other carriers. In order to assimilate so many iPhones, Sprint will have to double its contract subscribers, or convert the current ones to Apple fandom. In reality it will probably have to be a combination of both. An analyst predicted recently that Sprint might sell as many as six million iPhones next year, but that was before the rumored $20 billion deal with Apple

It is hard to imagine such a plunge by CEO Dan Hesse, which will make Sprint subsidize each iPhone with about $500 and then aim to recover costs over the two years of the contract without some sort of exclusivity over the iPhone 5. The sources say that the CEO himself said Sprint will be in the red on the deal until 2014. Sprint explicitly told its employees to be hush-hush about the iPhone arrival on its network, while working on things like upgrade fees and shorter contracts. If the unlimited data stays, however, it will be a great sticking point for new or current customers as well. 

An early exclusivity boost on the iPhone 5 could just give Sprint that initial headstart it will need to make whole on the $20 billion bet. And indeed, another source points out something that seemed unbelieavable at first, but now makes much more sense - that Sprint will have a WiMAX-enabled iPhone 5 in its portfolio announced tomorrow, and will keep the exclusive rights to sell it until LTE versions appear on AT&T and Verizon next year. Let's not forget Sprint is also planning to go the LTE-way.

The international version is still expected to sport an HSPA+ 4G radio, while the other US carriers will have to make do with an upgraded iPhone 4 in the meantime, and its combined GSM/CDMA chip. The iPhone 4S is said to sport a slightly underclocked A5 silicon, 8MP camera on the back and "HD" front-facing camera, plus NFC chip and metal or quality plastic back.

The Sprint-only iPhone 5 that might be unveiled tomorrow, is expected to feature a boosted A5 chip, larger 4" display of the bright LG NOVA sort, but with higher resolution, 32GB of memory and a larger battery, plus the exclusive for the phone voice recognition integration dubbed Assistant.  

Surprised about these eventual developments, or do you think this actually makes sense and ties the rumors nicely together?

source: WSJ & BGR

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posted on 03 Oct 2011, 14:43 11

1. Galen20K (Posts: 541; Member since: 26 Dec 2008)

wow, didn't expect this one... lol

posted on 03 Oct 2011, 15:48 3

15. Kjayhawk (Posts: 293; Member since: 07 Oct 2010)

If sprint did manage to pull off this deal DAMN!!!! thats exactly what sprint needs, the iPhone.

I really want this to be true! I'm leaving sprint, for Verizon. But it would be very cool to see sprint have an exclusive to the iPhone and see Verizon have the Nexus Prime! See them go head to head... Of course the iPhone would obliterate the Nexus Prime. But still it would be cool to see.

I guess we will figure out tomorrow what happens.

posted on 03 Oct 2011, 15:57 7

21. Dj21o (Posts: 437; Member since: 19 May 2011)

"Of course the iPhone would obliterate the Nexus Prime."

Are you stupid? Barely anything is changing on the iPhone 5. It will look just like all of the other iPhone models. :)

posted on 03 Oct 2011, 15:58

22. oddmanout (Posts: 442; Member since: 22 May 2009)

@Dj21o and you know this how???

posted on 03 Oct 2011, 16:05 3

27. Yeeee (Posts: 190; Member since: 02 Aug 2011)

because of all the leaked specs.

posted on 03 Oct 2011, 16:07 3

28. Dj21o (Posts: 437; Member since: 19 May 2011)

Dude look at the 4 iPhone models they have released. The ui looks the same. The screen is so damn small. They upped the speed a little in each one, but that is it.

For someone to say it will obliterate the Prime (which isn't even out yet), is stupid. I think you are asking the wrong person how they know anything.

I give it a speed improvement, but that is all. Maybe a little better battery. It is so damn boring. But everyone has a different opinion and I respect that. People just sound stupid.

posted on 03 Oct 2011, 16:20 3

37. thethingis (unregistered)

The thing is.. it WILL obliterate the PRIME in sale. I hate to say it, being a huge Android fan, but it's true.

Apple marketing will make this thing sell, sell, and sell.. just the fact that it's a new model will have people screaming for one. That's how apple has consumers thinking right now.

There are those of us that follow this stuff and see the PRIME as a better phone (subjective), but the vast majority of the consumers have sold into the fact that the iPhone is the holy grail of phones. period.

For me.. I'm waiting and almost 100% locked in on the PRIME. I can't wait to get it!

posted on 03 Oct 2011, 18:52 1

57. Dj21o (Posts: 437; Member since: 19 May 2011)

Yeah man, I'm excited for you to get ICS. That is going to be amazing. I bought the GSII, and I am still amazed at how fast and smooth it is. I can't wait to get it ported over to my phone. I have the honeycomb lockscreen and I am in love with it lol.

No doubt in my mind, Google will bring the asskicking with ICS.

posted on 03 Oct 2011, 21:27

69. taz89 (Posts: 2014; Member since: 03 May 2011)

no phone will come close or match the iphones in sale...apple have too much fans and have great marketing...but hey like you im waiting on the prime but till then im more than happy with my gs2 and iphone 4 combo....more sales does not mean better...

posted on 03 Oct 2011, 21:01

67. Kjayhawk (Posts: 293; Member since: 07 Oct 2010)

Who ever thinks the prime will out sell the iPhone is f**king stupid. And to think it will come even close is just as stupid

posted on 03 Oct 2011, 22:03

72. Dj21o (Posts: 437; Member since: 19 May 2011)

The thing is, is that people were waiting for an amazing android phone. The galaxy S II did just that. There are very few (patient) people that are waiting for it. I couldn't bare my Evolution any longer, and my phone is all rooted for ICS to get ported over.

Even then, I might keep this phone the way it is. It is just the fact I have options, not just waiting for Apple to release the new updates. And that is is all IOS 5 is. Call it innovative etc, but Apple will never leave what they have accomplished behind. I think they can do better honestly.

posted on 03 Oct 2011, 16:07 1

29. Laron (unregistered)

You have to realize, the average consumer or Apple fan doesn't care if the phone changes much. It's kind of like cars. Most cars keep the same body and shape for two to three, sometimes even four years, but the only thing they change are the tailights, headlight, grill, etc. Consumers want the newest, it's just the way it is and that is while some people might not like Apple or even despise them, their marketing strategy is second to none. I'm sure the Nexus Prime and Iphone 5 (if really released) will be great devices, but yes this is why it would be very easy for the Iphone 5 to obliterate the Nexus Prime in terms of sales.

posted on 03 Oct 2011, 16:09

31. Laron (unregistered)

I apologize for the errors in this, I didn't read it over.

posted on 03 Oct 2011, 16:14 3

33. Dj21o (Posts: 437; Member since: 19 May 2011)

Yeah, maybe sales. Nobody can keep saving up money to buy a 600.00 phone every single month (Android). There are already awesome phones that Android has released already. The GSII has hit a record in Europe.

People are obviously not going to look up specs and give a squirt of piss with the iPhone. They look at it and think it is the greatest thing on the earth. My opinion, it is not. But that is just me.

Benchmarks have shown otherwise, SALES in the smartphone industry has shown that Google is wiping their floor with Apple. Maybe not on individual phones, but from a global perspective, they are kicking their ass.

posted on 03 Oct 2011, 16:29

39. Laron (unregistered)

This is true, in terms of worldwide sales. Google wants Android to reach all corners of the world, I believe I read that in an article. I prefer Android myself, but have no problem with Apple, if someone gave me one for my birthday or as a Christmas present I wouldn't ditch it for an Android, they're both great phones. I just like Google's vision, but I don't get attached, it's just a piece of technology lol.

posted on 03 Oct 2011, 22:08

73. Dj21o (Posts: 437; Member since: 19 May 2011)

Lol it is hard not to get attached, especially when there is SO MUCH you can do on here. I don't use my laptop unless I absolutely have to. I download music, YouTube, pictures, facebook, tethering, I can't even put it all on here.

I do wish Android implemented the IOS notifications. Like screen on for messages/email, and the pop down box that shows the message when you are in an app. That I like about IOS. I have my GSII rigged to turn on and hitting search opens my messages, but I wish it was like IOS 5.

Other than that, IOS 5 is ehh.

posted on 03 Oct 2011, 16:11 3

32. Android4life (unregistered)

I don't understand why you would leave Sprint for expensive plans at Verizon. I dumped Verizon for Sprint, saving money and my service is stellar. Have fun getting ripped off.

posted on 03 Oct 2011, 16:33 3

40. Allday28 (Posts: 283; Member since: 19 Nov 2010)

Whens the last time sprint has upgraded there wimax footprint?!! Ill gladly pay the extra 10 dollars a month on verizon for such a better roll out of LTE anyday. Sprint is garbage!!

posted on 03 Oct 2011, 18:28 2

52. TOdoubleD (Posts: 114; Member since: 28 Mar 2011)

Why would Sprint spend another dollar on Wimax expansion when they're switching to LTE at the beginning of 2012? What's funny about people like you is you think that just because a carrier doesn't work well for you, that it's garbage everywhere. It's the same dumb s**t on this site all the time. My carrier is better than yours and my phone is better than your phone. Good grief.

posted on 03 Oct 2011, 16:42 1

42. Chakra (Posts: 130; Member since: 02 Dec 2009)

Congrats to you. Mabye sprint coverage isn't so stellar to him.

posted on 03 Oct 2011, 21:47

70. superguy (Posts: 293; Member since: 15 Jul 2011)

Better coverage, speed, and reliability come as reasons.

YMMV depending on where you live. But cost isn't the only consideration for a lot of people. You get what you pay for.

posted on 03 Oct 2011, 14:45 5

2. BrockSamson (unregistered)

I will laugh so hard if this is true :)

posted on 03 Oct 2011, 14:51

3. vette21man (Posts: 351; Member since: 06 Apr 2011)

Wow, disappointingly this ties the rumors together. Being an AT&T customer, I would be pretty angry knowing that I still have 1yr left on my 2yr agreement, and I can only "early upgrade" to an iPhone 4S, while Sprint customers get a better update with the 5. Granted, Sprint customers have been "angry" this whole time being without the iPhone until now. What a change in tides this would be!

posted on 03 Oct 2011, 15:38

13. Kjayhawk (Posts: 293; Member since: 07 Oct 2010)

if anything it might come to sprint first, like the galaxy s2, but a sprint exclusive i doubt that. I'm leaving sprint today actually and returning to verizon. I would doubt it will be a sprint exclusive but thats just me. It would be pretty funny if this was true.

posted on 03 Oct 2011, 14:56

4. AppleFanboy (Posts: 142; Member since: 07 Jun 2011)

How about the fact that every other customer needs an Airave to get any type of connection?? Their coverage sucks and thats why theyre in the hole....the iPhone wont help much

posted on 03 Oct 2011, 15:07 2

8. Who Said No (unregistered)

Did coverage sucks??? It all despends on were your at. I have the iphone 4 with AT&T and my service sucks. When I had sprint I had no Drop calls, I had no problem picking up signal

posted on 03 Oct 2011, 19:53

64. Phonecall01 (unregistered)

you need to do some research...

posted on 03 Oct 2011, 15:00 5

5. TKFox007 (Posts: 303; Member since: 02 Nov 2010)

Why do I not believe that BGR report? Lets see, Sprint is dropping WiMax (which hasn't been expanded upon in a LONG time) for LTE. Why would Apple make their next iPhone exclusive on a network smaller than Verizon and AT&T? That's just utter foolishness.

posted on 03 Oct 2011, 15:45

14. Afterkick (unregistered)

20 billion dollars? Thats a lot of money my friend

posted on 03 Oct 2011, 16:03 2

25. TKFox007 (Posts: 303; Member since: 02 Nov 2010)

That's pocket change to Apple

posted on 03 Oct 2011, 16:04 3

26. Joshing4fun (Posts: 1236; Member since: 13 Aug 2010)

Does Sprint even have $20 billion?

posted on 03 Oct 2011, 16:56

46. Afterkick (unregistered)

Haha great point! I think its a great thing for sprint though, it'll get people I believe, just how many is the question. And is it enough to get people over with their spotty home network? We'll see what happens I guess, It'll be interesting at least.

posted on 03 Oct 2011, 15:04 1

6. Phullofphil (Posts: 801; Member since: 10 Feb 2009)

F....ing retarded. I assume they might lose some potential business if this is true. It seems like a b.s. Story really, kinda abandoning iPhone fans that are on att and Verizon that were waiting on the I phone five that already had the iPhone four for a year and a half to just get pretty much the same phone. I sure hope this is not true.

posted on 03 Oct 2011, 15:07

7. Srinivas Korapati (unregistered)

No wonder why Verizon went on Samsung side in patent case between Apple and Samsung.

posted on 03 Oct 2011, 15:19 2

9. SuperAndroidEvo (Posts: 4833; Member since: 15 Apr 2011)

Wow like I have always said Sprint wants to win. I love Android & I love the fact that Sprint wants to do everything it can to say competitive. If Sprint makes a lot of money from this & gains a lot of customers then maybe Sprint can keep the unlimited plans hopefully forever. To me that is the MOST important thing. I am for Sprint making a lot of money even if they need the iPhone 5 to do it. Their plans are great & their customer service is wonderful. I love Sprint as a carrier & I love the direction they are going. This is an impressive move. Let's see if this will actually happen. Tomorrow we will find out if the Sprint iPhone 5 will be the only iPhone with 4G in the U.S.

posted on 03 Oct 2011, 20:07

66. NONBIASEDOPINION (unregistered)

If they get more customers, they will drop the unlimited option because there will be more customers eating up service. That's the main reason why carriers limit or slow data. Too many people using too much data ruins it for everyone.

posted on 03 Oct 2011, 15:19 1

10. Allday28 (Posts: 283; Member since: 19 Nov 2010)

This would be a huge mistake on apple and sprints side!! They would piss off way to many iphone fans. This could really be the death of sprint with suge a huge deal like this if it doesnt work out right..

posted on 03 Oct 2011, 15:50 1

17. DJLegacy2kALLDAY (unregistered)

What? lol

It can only help sprint, wtf are you talking about? iPhone customers are worthless and will go ANYWHERE the iPhone is. They will buy a 4s even though its a cheaper version of the 4 they already have. They dont care because they are pathetic and just want Apples nuts.

They will all run to Sprint too for unlimited data

posted on 03 Oct 2011, 15:55 1

20. Allday28 (Posts: 283; Member since: 19 Nov 2010)

Yeah but sprints network is horrible and pathetic and its only gonna get worse if this happens. Sprint is so desperate for customers right now in case the att and tmobile deal goes through that dan hesse would probably sale his soul to the devil. This is alot of money for a company the size of sprint to invest into, and if doesnt work out they are gonna be screwed!! But thats ok with me cause all I really care about is the Vigor, Razr and Prime coming. Those are the three im gonna be choosing from..

posted on 03 Oct 2011, 16:26 1

38. DJLegacy2kALLDAY (unregistered)

But if sprint locks MILLIONS of people into the iPhone for 2 years, as long as they fix those network issues within 2 years people will stay for exclusives...same thing when the iphone launched on att...especially if sprint keeps unlimited data for a few years.

posted on 03 Oct 2011, 16:43 1

43. Allday28 (Posts: 283; Member since: 19 Nov 2010)

Yeah and att is still having problems with there network to this day cause of that. Sprint fixing there network in a couple years i doubt it when att couldnt even do it with alot more money than sprint has. Plus sprint is gonna be switching to LTE so there goes more money down the drain.. Its all coming to being desperate..

posted on 03 Oct 2011, 18:36 1

54. TOdoubleD (Posts: 114; Member since: 28 Mar 2011)

Sprint has already begun network improvements through network vision. The more customers they add, the more money they make, the faster the network vision project is completed. I think some of you guys are going to be shocked at where Sprint is a year from now. And it's not in a bad way.

posted on 03 Oct 2011, 19:22

59. Allday28 (Posts: 283; Member since: 19 Nov 2010)

Did you not read the article buddy?? There gonna be losing money for the first three years because of this!!

posted on 03 Oct 2011, 18:51

56. WhoWeTalkinBout (unregistered)

Yeah, ATT is still having problems with their network because building up and improving on their network is not really that high up on their list of things to do. ATT would rather gobble up T-Mo for 40 billion dollars then invest just a tenth of that into their current infrastructure and improve their towers. That is the difference between ATT and Sprint.

posted on 03 Oct 2011, 15:27

11. snowgator (Posts: 3583; Member since: 19 Jan 2011)

Ain't buying it. Period, end of story. Maybe there is a period where Sprint get's to sell the iPhone 5 before Verizon and AT&T. But only Sprint? Not until we hear it from Apple and Sprint.

posted on 03 Oct 2011, 15:49

16. Tmachaveli (Posts: 425; Member since: 01 Apr 2011)

wow holy sh*t im happy because im a sprint customer and im glad to see the iphone finally here. I may not like the phone but i have to be real and know that it will sell. old boy danny pulled one of his ass lol

posted on 03 Oct 2011, 15:52

18. squallz506 (unregistered)

i cant see sprint getting the 5 while everyone else has the 4S. i could see sprint getting a wimax iphone while at&t gets an hspa+ and verizon is stuck with EVDO. im not a big fan of ios or the iphone, but i think sprint having the fastest 4g iphone (if at&t gets an hspa+ that is) during the winter shopping season and tax refund month could give them a huge boost in subscribers. lets not forget that thousands of people are getting their first smartphones everyday. im on VM and hope this doesnt effect my download rate (~900kbp/s) or plan pricing ($25/mo).

posted on 03 Oct 2011, 15:52

19. Tmachaveli (Posts: 425; Member since: 01 Apr 2011)

i mean out of his ass lol

posted on 03 Oct 2011, 16:02

23. Laron (unregistered)

So... What I get out of this article is that Sprint is trying to pull an AT&T move, like when AT&T was the only carrier that offered the original Iphone. I hope that this move works for Sprint, and I hope with the incoming money that Sprint hopes to get from this move, they invest in their network to keep data unlimited.

posted on 03 Oct 2011, 16:46 1

44. Allday28 (Posts: 283; Member since: 19 Nov 2010)

Thats a problem cause they will be actually be losing money for the first three years or so.

posted on 03 Oct 2011, 16:02

24. baldilocks73 (unregistered)

This will never happen... sorry.

posted on 03 Oct 2011, 16:08

30. Phoneguy007 (Posts: 218; Member since: 02 Jun 2011)

I dont belive this at all.....phone scoop already posted this and it said nothing of a sprint only i5!

posted on 03 Oct 2011, 16:16 1

34. Androidguy (Posts: 7; Member since: 30 Sep 2011)

Since the new iphone is starting to look pretty intersting to me i may by one just to have but my original plan was to buy one and sell it on ebay..hmm..i guess ill buy one and sell the other on ebay and in case i hate the other iphone too, ill sell that one also! problem solved :). probably gonna by a droid razor or vigor wit the money anyway lol.

posted on 03 Oct 2011, 16:16 1

35. bubba78 (Posts: 57; Member since: 23 May 2011)

The article on PA says Sprint will buy 30.5 million iPhones over the next 2 years, but the actual Wall Street Journal article says 4 years.

posted on 03 Oct 2011, 17:14 1

49. corporateJP (Posts: 2431; Member since: 28 Nov 2009)

That makes somewhat more sense, but is still crazy unattainable in my mind for a carrier like Sprint.

posted on 03 Oct 2011, 16:17 1

36. Veritech (unregistered)

Ironically, this makes a lot of sense. If you look at Apple product design and implementation trends. They've always been focusing on a thin and sleek look combined with state of the art technology. The downside with LTE is the chipsets are way too big to make a compact phone. For example, take a look at the Droid Charge, HTC Thunderbolt, and Droid Bionic. The LTE chipset made these phones huge and they cost more when compared to an hspa+ or a WiMax chipset. Think about it, it will only take apple a short time for them to have a second gen LTE chipset ready to go for iPhone 5s. Which would probably launch in June with even better specs. Most customer would be willing to wait 8 months to get the better LTE Version; I know I would. If Sprint thinks Launching the 32gb iPhone 5 will save them they're completely wrong. Why would anyone go to Sprint for the higher spec iPhone 5 (which, will probably cost $299.99 with 2 year discount)? When you can go to att or Verizon and get the iPhone 4s for $199.99 or just wait. Sprint just gave apple a lot of money and dug their own grave.

posted on 03 Oct 2011, 17:05 1

47. Allday28 (Posts: 283; Member since: 19 Nov 2010)

I definetly agree with you on this one..

posted on 03 Oct 2011, 16:36 1

41. sid8911 (Posts: 54; Member since: 29 May 2010)

i remember the idea that , iphone wasnt gonna be on every carrier

posted on 03 Oct 2011, 16:48 1

45. vette21man (Posts: 351; Member since: 06 Apr 2011)

Wondering if the iPhone being ubiquitous on every major carrier will make it lose its "exclusive" appeal.

posted on 03 Oct 2011, 17:12

48. corporateJP (Posts: 2431; Member since: 28 Nov 2009)

This has to be a joke.

Sprint doesn't even have that many customers, nor will it anytime soon.

They better hope for two things: FAST LTE rollout and the next iPhone to support LTE.

I don't see one or the other happening anytime soon.

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