Some comments from Lauer on Sprint PCS progress and CS

[larry]

Sprint PCS is right where it needs to be, Lauer says

By SUZANNE KING
The Kansas City Star

Len Lauer, Sprint Corp.'s wireless division president, looks at the 1.3 million new customers that rival Verizon Wireless added last quarter and feels not the least bit covetous.

"Not all customers have the same value," Lauer said this week in a telephone interview.

Sprint PCS, which grew by a comparatively small 617,000 customers in the second quarter, is right where it needs to be, Lauer said.

PCS, the country's fourth largest wireless carrier, with 18.8 million customers at the end of June, may be adding fewer customers than Verizon, the largest cell phone company. But the customers Sprint is adding tend to spend more on their cell phone bills each month.

In the second quarter, Verizon's customers spent an average of $49 on their monthly cell phone bills. Sprint's spent an average of $62 a month. Only Nextel Communications Inc., whose largely business customer base spent an average of $69, reported higher monthly user revenue.

Over the long term, Sprint will be better off having bigger spenders, Lauer said: "We're on a growth strategy, but we also want to attract higher usage customers."

Wall Street apparently likes the way things are going.

Sprint's PCS tracking stock has climbed from below $2 last September to over $6 in recent weeks. Of course, the stock price still is a long way from where it was in spring 2000 -- over $65. PCS shares closed Wednesday at $6.12, down 26 cents.

But Lauer said the company's second-quarter results showed that Sprint's wireless division is turning things around.

"We're executing better," said Lauer, who took over at the wireless division last October after Sprint PCS had its worst quarter ever. In the third quarter of 2002, the company reported a net loss of customers.

"It's obviously much better having positive momentum moving forward. And we have that here at PCS," Lauer said.

Sprint PCS' second-quarter operating revenues increased to $3.1 billion, from $3.02 billion a year ago. Net losses narrowed to $92 million, from $170 million a year earlier.

Customer growth of 617,000 -- 360,000 retail customers, 80,000 affiliate customers and 177,000 wholesale customers -- was the second highest among the national wireless carriers. The quarter's growth was strong, especially since a high percentage of new customers are prime credit customers, Lauer said.

That's important for a company that a year ago was growing largely through a program that delivered service to subprime customers. Lauer scrapped the program, which led to a sharp increase in churn, the industry term for customers dropping service.

In the second quarter, churn also improved substantially, to 2.4 percent in the second quarter from 3.1 percent in the first quarter. Average monthly customer use also grew, to 13.5 hours from 12 hours in the first quarter.

Both factors reflect improvements the company has made in customer satisfaction, Lauer said.

"In terms of customer experience, we're getting now to about average for the industry," he said. "That doesn't make me happy, but it's good progress from where we were. We're determined to lead this industry in customer satisfaction."

The company is going after capital dollars to improve network coverage by adding cell sites to existing coverage areas and improving existing cell sites to provide better coverage inside homes and offices.

Sprint also is seeing improvement in its business sales, and its wireless data services are being more widely adopted.

In the second quarter, the company's 4.6 million data subscribers contributed nearly $2 to average monthly revenue per user. Nearly 40 percent of new customers -- gross additions -- signed up for PCS Vision service, despite the fact that the price increased to $15 from $10 in April.

That's significant, company officials said, because Vision customers tend to stay with Sprint's service at a better rate than voice-only customers. Vision services, such as a service that lets customers mail photos between wireless phones, promise to bring more customers to Sprint in future quarters.

Even outsiders are starting to notice the improvements, Lauer said. Recently released customer loyalty awards by Brand Keys put Sprint PCS second behind Verizon Wireless among wireless carriers.

That's the right idea, Lauer said.

"It's been a while since we've been second...in an overall satisfaction survey," he said

http://www.kansascity.com/mld/kansa...ess/6421686.htm

[larry]

Now if Mr. Lauer will see to improving the coverage maps I'll be a happy camper. [img]i/expressions/face-icon-small-smile.gif[/img]

[WirelessBeachBum]

If Mr. Lauer had seen to bailing out his affiliates, lots of my friends would still have their jobs. Their customer service is improving in their non affiliate markets, however in the affiliate markets it is getting worse because of job cuts.....

[larry]

That's too bad about the affiliates. It seems like they did have the money to help but are instead using it to improve the coverage in many of their own markets now which I suppose is a good thing but then the affiliate areas will suffer.

[NYCDru]

I got to give credit were credits due. This guy has definately turned Sprint PCS as a compny around. Under his leadership they might actualy be able to eventualy become the number 3 carrier in the nation(numbers wise) in the next 2 years.