Sprint doesn’t plan to dump WiMAX entirely after it takes its new LTE network live this summer. Instead, it plans to reposition the older 4G technology as the network for its prepaid customers. Sprint will begin selling WiMAX devices next quarter under the Boost Mobile and Virgin Mobile brands, network operations president Steve Elfman said Wednesday on Sprint’s first quarter earnings call.
The strategy makes perfect sense for Sprint, which is trying to sort through a growing number of network technologies. WiMAX powers all of its 4G smartphones and modems today, but Sprint is already phasing out WiMAX devices and selling its first LTE smartphones in preparation for the new network’s launch this summer. While it will continue to support existing WiMAX smartphones and device customers, it won’t add many new ones – at least not under the Sprint banner.
Network partner Clearwire supplies Sprint’s WiMAX capacity but it only does so in a limited footprint, making it increasingly difficult for Sprint to pit its current 4G service against its competitors large and growing LTE and HSPA+ networks. Sprint, however, is Clearwire’s majority stakeholder and has committed to selling the wholesale mobile broadband carrier’s WiMAX and future LTE capacity for years to come. By shifting WiMAX over to Boost and Virgin, Sprint can deliver faster speeds to its growing prepaid base – it added 489,000 net prepaid subscribers in the first quarter – while keeping Clearwire afloat during its transition to LTE.
Moving prepaid data customers over to WiMAX also takes some of the burden off its 3G network in areas 4G is available. Sprint is beginning to load up its 3G network with iPhones, so it probably needs all the CDMA EV-DO capacity it can spare.