Sprint has a lot to gain by selling the new iPhone 4S starting Oct. 14, including new customers attracted to Sprint's unlimited data plans and up to 2 million existing customers likely to upgrade to Apple's latest smartphone.
That's the thinking of Chris Collins, an analyst at Compete, which has surveyed 4,220 U.S. wireless customers at the four biggest carriers for the last year.
Collins' survey found that Sprint was the carrier with the largest percentage of customers (12.5%) who were waiting for a particular smartphone to be sold. When Collins multiplied that 12.5% result with Sprint's 16 million postpaid subscribers who are not yet on smartphones, he found "2 million existing subscribers who have been sitting on the sideline waiting to upgrade from their current feature phones."
Compete also asked which specific smartphone Sprint subscribers were waiting for, and the majority said an Apple smartphone, Collins said. In an interview, Collins said the Sprint upgrade to the iPhone 4S could be a total of 1.1 million to 2 million customers, but he added that he is "confident" that the number is closer to 2 million because of the spike in the number of Verizon Wireless customers who upgraded to the iPhone 4 last February.
In Verizon's case, customers were upgrading to an iPhone 4 that had already been sold by AT&T for seven months. With Sprint, customers will be getting the same iPhone 4S as Verizon and AT&T at the same time, which is an advantage for Sprint, Collins noted.
Since the device has a faster processor, better camera and other features, Sprint's unlimited data plans will be an important differentiator over the other carriers, he said. Compete hasn't tabulated how many iPhone 4 customers there are in total from both Verizon and AT&T, but Collins said a second quarter survey showed that more than 70% were using AT&T and less than 30% were using Verizon. AT&T benefited by selling the device longer.
When the iPhone 4 first went on sale in June 2010, an analyst at Oppenheimer estimated that Apple sold more than 1 million of the devices on the very first day.
Apple reported in July that it sold 20.3 million iPhones in the third quarter, a 142% increase over the third quarter of 2010.
Collins said that Sprint's gain with new customers and those upgrading to the iPhone 4S could help explain why Sprint reportedly laid out "boatloads" to Apple for the right to sell the device. Over four years, Sprint is reportedly paying Apple $20 billion for 30.5 million iPhones.
While Collins is generally upbeat about Sprint's prospects with the iPhone 4S, ComScore recently noted that any gains Sprint makes could be undercut by Verizon's better reputation for customer service and by AT&T's ability to offer the iPhone 3GS for free and the iPhone 4 for $99.
Sprint is expected to divulge more details about its iPhone 4S data pricing at an event scheduled for Friday in New York. Collins said he expects Sprint to keep unlimited data plans in effect for the "near term," but that eventually Sprint will move to data tier pricing, as AT&T and Verizon have already done.
Matt Hamblen covers mobile and wireless, smartphones and other handhelds, and wireless networking for Computerworld. Follow Matt on Twitter at @matthamblen or subscribe to Matt's RSS feed. His e-mail address is email@example.com.