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Tag Archives: Sprint

Sprint Merger with Leap Wireless or MetroPCS Makes Sense–RBC

RBC Capital Markets has released a report that a merger between Sprint and either Leap Wireless or MetroPCS is not only possible but makes sense. This is not the first time this has come up. In late February of this year, it was widely reported that Sprint’s board rejected a proposal to acquire MetroPCS for $8 billion in an all-stock transaction, because of the dilution to Sprint equity.

The key component that has changed since February is the outperformance of Sprint’s equity versus that of Leap or MetroPCS, which translates into less equity dilution in a stock-based transaction and more attractive EBITDA multiples, according to RBC.

“In light of Sprint shares’ significant outperformance versus Leap and PCS, we believe a bid for Leap or MetroPCS is a distinct possibility,” Jonathan Atkin, RBC analyst, wrote. Additionally, refinancing either the debt of Leap or MetroPCS has decreased by between $50 million and $60 million since February, RBC statistics show.

Either Leap Wireless or MetroPCS would be a good fit, because like Sprint, they are facilities-based wireless operators that use CDMA technology at 1.9 GHz.

“As such, an integration by Sprint of either company would entail minimal technical risk, require no handset migrations, and quite possibly drive top-line ARPU synergies, because of the elimination of a prepaid competitor, and churn improvement due to the elimination of a competitor as well as the likelihood that the acquired customers would find themselves with superior network quality and coverage,” Atkin wrote.

Atkin does not believe a merger would provide any conflicts with Sprint’s ongoing Network Vision project deployment. Additionally, a merger would most likely not receive pushback from federal antitrust regulators. In fact, Atkin noted, no other pairing between carriers makes any sense.

“[A merger of] Sprint/T-Mobile or a different national carrier (AT&T or T-Mobile) purchasing Leap or MetroPCS would be unrealistic given recent statements by company managements, technology incompatibilities and regulatory uncertainties,” Atkin wrote.

HUBER+SUHNER now leading supplier for LTE installation systems in North America

July 5, 2012

The upgrade of mobile communication platforms to the fourth generation transmission standard, Long Term Evolution (LTE), is in full swing in North America. Major network operators in the USA and Canada have already launched their first broadband networks and will continue to roll out tens of thousands of mobile communication antennas over the coming months and years. Most operators rely on the latest solutions from HUBER+SUHNER – since January 2011, the company has been awarded tenders worth in excess of USD 100 million, which will become effective over the coming years.

Sprint, T-Mobile (USA), Bell Mobility, SaskTel and Telus (Canada) are telephone companies with 10 to 40 million subscribers each. They all want to guarantee their customers the fastest possible connections and are therefore upgrading their networks to the next-generation LTE standard at a record pace. T-Mobile alone, for example, will upgrade over 14,000 mobile antenna masts in the USA using HUBER+SUHNER solutions over the next 12 months, and Sprint plans to upgrade around 15,000 sites within three years. Several smaller mobile operators in the USA have also decided to expand their infrastructure to the fourth generation transmission standard using technology from Switzerland.

Leading FTTA technology
To ensure that their mobile communication networks are converted quickly and cost effectively, the North American phone giants and their infrastructure vendors like Ericsson or Nokia Siemens Network are relying on the most recent FTTA (Fiber to the Antenna) system solutions from the Swiss company HUBER+SUHNER. In FTTA technology, the send-receive electronics are installed near the antennas on the mast (remote radio heads – RRH). In previous installations, the send-receive electronics were housed in cabinets on the ground. FTTA technology therefore requires that RRHs be supplied with data as well as power. The “MASTERLINE extreme hybrid” cable systems combine multiple fiber optic and power cables. The Swiss systems therefore offer high-speed data transfer together with quick and easy installation. HUBER+SUHNER is currently the only company worldwide offering such a wide range of solutions for this rapidly growing market.

Radio frequency components
The Fiber Optics Division is not the only area at the company that will benefit from the large orders from North America. The Radio Frequency Division will deliver a very high number of jumper cables over the coming months to North America. They transmit radio frequency signals between the remote radio heads and mobile communication antennas. For the network upgrade this division also offers components that protect the sensitive electronics from power surges during lightning strikes and its so-called Smart DC Kits, developed to re-use installed radio frequency cables for supplying power to the remote radio heads.

The upgrade of mobile networks will take up speed across the world over the coming years and offer HUBER+SUHNER additional business opportunities. The Swiss company is already developing next-generation FTTA solutions, which will enable an even faster and more cost effective expansion and thereby underline the company’s position as a technological leader in the market of Fiber to the Antenna installations.

LTE Networks March Forward, But Throughput May Lag

Having seen its WiMAX network go the way of Sony’s BetaMAX, Sprint has turned on its LTE network, known as Network Vision, in 15 cities in Georgia, Kansas, Missouri and Texas. The initial deployment covers users in the Atlanta, Dallas, Houston, Kansas City and San Antonio markets.

Sprint plans to launch additional LTE markets in the second half of 2012 with the completion of the nationwide network slated for the end of 2013. Along with the 4G rollout, Sprint promised the deployment of an “all-new enhanced” 3G network covering 250 million people across nation.

Neal Gompa of the Extreme Tech web site raises questions about whether Sprint’s Network Vision will produce 4G speeds because of backhaul and spectrum limitations (5 megahertz downlink and 5 megahertz uplink).  But help is on the way. The carrier plans to use Clearwire’s 2500 MHz service, which will launch at 5,000 TD-LTE cell sites in June 2013, and it will deploy LTE on its 800 MHz (formerly iDEN) network in 2014.

“Nationwide, Sprint [has a] throughput cap, as well as a capacity cap. However, it can be partially defeated by building a denser infrastructure,” Gompa wrote. “Sprint is also likely using relatively poor backhaul compared to AT&T, T-Mobile and Verizon Wireless. Deploying LTE without improving the backhaul will result in speeds that most people commonly associate with 3G. Indeed, it compares only slightly favorably to AT&T’s HSPA service.”

While Sprint grabbed the headlines with its LTE rollout, Verizon Wireless continued its full-on assault making its LTE network available in 33 additional markets in July.

Verizon Wireless’ July launches will bring its total number of markets covered to 337.  The 33 additional markets include smaller cities, such as El Dorado/Magnolia and Russellville, Ark.; New London County, Conn.; Fort Pierce and Melbourne/Titusville, Fla.; and Columbus and Rome, Ga. The company said it is on track to cover more than 400 U.S. markets by the end of 2012.

Also in July, the company expanded its 4G coverage in 32 existing LTE markets, including Mobile, Ala.; Los Angeles, San Diego and San Francisco, Calif.; Washington, D.C.; and Fort Lauderdale, Miami and Sarasota/Bradenton, Fla.

Meanwhile, AT&T has added LTE service in several markets in 2012 and is now live in 47, reaching more than 260 million people.

“AT&T might be playing catch-up with Verizon, but with more than 40 cities either covered or soon to be active, it’s clear that AT&T’s taking it seriously,” wrote Jamie Keene in The Verge.

In July, AT&T turned on its LTE network in Buffalo; Burlington, N.C.; Corpus Christi, Texas; Gainsville, Ga.; Winston-Salem and Greensboro, N.C., Wichita, Kan. June brought LTE service to Nashville and Lawrenceburg, Tenn. In March, AT&T announced its LTE service plans scheduled for April, May and into the early summer to several markets, including Cleveland, Akron and Canton, Ohio; Naples, Fla.; Bloomington, Lafayette and Muncie, Ind.; Baton Rouge and New Orleans, La.; St. Louis, Mo.; Bryan-College Station, Texas; and Staten Island in New York City.

T-Mobile, which is in the early stages of equipping its towers with LTE equipment, launched HSPA+ (what it calls 4G) in Abilene, Amarillo, Odessa, and Victoria, Tex; Bakersfield, CA; Eau Claire, Wis.; Joplin and St. Joseph, Mo., in March and now covers. 220 million people in 229 markets with the technology that has theoretical download speeds of 42 mbps

T-Mobile’s latest ad does a nice job of educating the public about wireless infrastructure, showing its spokes-model Carly Foulkes riding her Ducati motorcycle past several of the carrier’s more than 35,000 cell towers.

“The great news for our customers is that we’re continually making the T-Mobile 4G experience faster and more dependable as we modernize the network in 2012 – improving signal strength, in-building coverage and device choice – and prepare to launch LTE next year,” Neville Ray, chief technology officer, wrote in his blog. “Our new ‘towers’ ad is just another way we’re letting our customers know they’re covered by T-Mobile’s 4G network.”

Storms Bring ‘Cell-mageddon’ to Mid-Atlantic Tower Sites

Cell site backup power systems were put to the test late in June as a freak series of thunderstorms with hurricane-like winds, known as a derecho, caused 22 deaths and knocked out power to millions in the Mid-Atlantic, as well as to hundreds of cell sites across the region. A state of emergency was declared in Maryland, Virginia and Washington, D.C., as power companies worked to restore electricity.

T-Mobile, which lost power to one fourth of its cell sites in the area, deployed generators and thousands of gallons of fuel. Angry residents reported cellular outages, July 2, on the Sprint Nextel system across the Washington, D.C., metro area, with one frustrated user coining the term “cell-mageddon.”

“T-Mobile began deploying generators to cell sites without power on Friday evening, June 29. T-Mobile also dispatched additional personnel from surrounding markets over the weekend to restore service to areas hardest hit by the storm,” a T-Mobile spokesman said in a email.  “Additional mobile generators were deployed Sunday to the greater Washington D.C area alone. By Tuesday evening, July 3, the T-Mobile network was operating at normal or near-normal levels in all areas affected.” 

Ever since the Katrina debacle, the government has pressured the wireless industry hard to keep cell sites on the air after natural disasters, proposing to mandate backup power at one point. Verizon installed 1,300 generators nationwide in the last year and had more than 450 sites running on generators because of the storm. AT&T said it has doubled the number of generators in the field to 10,000 in the last three years.

When NTIA and FCC Pull the Plug on LightSquared, Will it Dim Sprint’s Network Vision?

What began as such a promising idea for a $7 billion nationwide broadband wireless network with 40,000 antenna sites may not receive the regulatory approval it needs to move forward. In a letter sent on Wednesday, The National Telecommunications and Information Administration updated the FCC on its latest independent evaluation of the negative impact of LightSquared on GPS services.

“We conclude that the LightSquared mobile broadband network will impact GPS services and there is no practical way to mitigate the potential interference at this time,” wrote Lawrence Strickling, NTIA assistant secretary for communications and information.

Last July, LightSquared entered into an agreement with Sprint where it promised to pay the carrier $9 billion to deploy its nationwide LTE network over the Network Vision infrastructure and would have received credits valued at $4.5 billion. In October, Sprint accelerated deployment of Network Vision, which consolidates multiple network technologies into one seamless network. The demise of LightSquared leaves Sprint’s pocketbook quite a bit lighter and its spectrum-hosting business without an anchor tenant.

The FCC’s International Bureau, which had issued a conditional waiver order prohibiting LightSquared from operating until harmful interference issues were resolved, immediately released a statement that appeared to bow to the will of the NTIA.

“The NTIA, the federal agency that coordinates spectrum uses for the military and other federal government entities, has now concluded that there is no practical way to mitigate potential interference at this time. Consequently, the commission will not lift the prohibition on LightSquared,” said FCC spokesperson Tammy Sun.

The FCC is releasing this week a Public Notice seeking comment on the NTIA’s conclusions, proposing to vacate the conditional waiver order and suspend indefinitely LightSquared’s ancillary terrestrial component authority.

The FCC faced monumental challenges in attempting to allow terrestrial mobile communications on the satellite spectrum. Especially frustrating for the commission were the GPS receivers that pick up signals from uses in adjacent bands.

“There are very substantial costs to our economy and to consumers of preventing the use of this and other spectrum for mobile broadband,” Sun said. “Congress, the FCC, other federal agencies and private sector stakeholders must work together in a concerted effort to reduce regulatory barriers and free up spectrum for mobile broadband.” She called for better receiver performance standards as a way to more efficiently use spectrum.

Federal agencies decided earlier this week that they will develop new GPS spectrum interference standards for future proposals for non-space commercial uses of adjacent bands.

“NTIA recognizes the importance that receiver standards could play as a part of a forward-looking model for spectrum management even beyond the immediate use of GPS,” Strickling wrote.

In a sure sign that the end is nigh, Bloomberg Businessweek reports that Phil Falcone, whose hedge fund Harbinger Capital Partners invested $3 billion in LightSquared, is attempting to swap the spectrum, valued at $500 million by Skyterra, with the U.S. Department of Defense to salvage some of his investment. Since its subprime loan investments paid off handsomely five years ago, Harbinger’s capital has dropped from $26 billion to $4 billion.