Sprint's Struggle Raises Doubt On Wireless Growth

The vast decline in Sprint contracts and stock has led to company cutbacks and industry-wide anxiety. This article questions whether Sprint's setbacks are signalling an economic trend that effects other wireless companies.

Sprint’s Customer Erosion Prompts Cutbacks
By: Steve Lohr
New York Times
Jan. 19, 2008

Sprint Nextel’s announcement on Friday that it is losing customers more rapidly than expected is making investors nervous about a weak economy’s effect on other wireless companies.
Shares of Sprint fell $2.87, or 25 percent, to $8.70 after it said that it planned to lay off 4,000 workers and close stores to trim costs as its customer base shrinks.
The stock prices of AT&T and Verizon also slipped after the news. AT&T, the largest wireless carrier, was down more than 3 percent, and Verizon, which owns Verizon Wireless along with Vodafone, fell more than 4 percent.
Sprint has been struggling for more than a year, and installed a new chief executive only last month. But the sharp drop in the company’s customer count during the traditionally strong holiday quarter, analysts say, raises concerns that the problem extends beyond Sprint.
“The broader question here is whether this is the tip of the iceberg in a deceleration of the U.S. wireless market over all,” said Craig Moffett, an analyst at Sanford C. Bernstein & Company....It is unclear whether Sprint’s travails are solely its own or portend broader troubles for cellphone carriers.....
http://www.nytimes.com/2008/01/19/technology/19sprint.html?em&ex=1200891600&en=968c02d651ba9073&ei=5087%0A

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