Sprint Nextel (NYS: S) is investigating reports that some Apple (NAS: AAPL) iPhone 4S customers on its network have been experiencing slower-than-expected data speeds, a senior Sprint executive said. The carrier is working with Apple on the issue but does not yet have a solution, according to Fared Adib, vice president of product development for Sprint.
"We're taking the reports of problems from a small number of customers seriously," Adib said in an interview with CNET. "There's nothing of significance to report yet."
Since Sprint started selling the iPhone Oct. 14, there have been a number of reports from Sprint customers that their iPhones were experiencing unusually slow data connections on Sprint's CDMA EV-DO data network. The problem is a hot topic on Sprint's support message board, with more than 1,200 responses and 235,000 views. Adib told CNET that the complaints represent a single-digit percentage of the base of Sprint's iPhone 4S customers.
Adib told CNET that Sprint is having a difficult time replicating the issue on its own, which makes it more difficult to diagnose the cause of the problem. He said when Sprint finds a solution, it will let customers know quickly.
Sprint executives said during the company's third-quarter earnings call that they expect the iPhone to account for 20 percent to 40 percent of Sprint's postpaid gross additions and upgrades during the company's four-year, $15.5 billion contract with Apple. Sprint executives said the contract is subject to a variety of factors including the number of models offered, and that Sprint expects to "outperform" that contract.
Sprint's other major investment area is its Network Vision network upgrade, which includes a transition to LTE by mid-2012. Sprint plans to spend around $10 billion in 2012 and 2013 deploying Network Vision and LTE as well as maintaining its legacy wireline and wireless operations. At the same time, Sprint has said it will save $10 billion to $11 billion in operating expenses and capital expenditures from 2011 to 2017, including $4 billion from shutting down iDEN service.
Speaking at the company's developer conference in Santa Clara, Calif., Sprint CEO Dan Hesse took note of the investments.
"They are going to be a big cash drain," he said, adding that both are necessary investments. "Having a great network is just table stakes to being a great wireless company. We are going to do what it takes."
This article originally published here. Get your wireless industry briefing here.
At the time thisarticle was published The Motley Fool owns shares of Apple. Motley Fool newsletter services have recommended buying shares of Apple. Motley Fool newsletter services have recommended creating a bull call spread position in Apple. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.
Copyright © 1995 - 2011 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.