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Tarek Robbiati, who became the Chief Financial Officer for Sprint on Aug. 31, has had a few months to digest some key aspects of the operation. Robbiati believes there are three key metrics Sprint uses to spur customer engagement, sparking a memorable customer experience.
“The way we look at our network from a metrics perspective is there are three core metrics really that truly matter at the end of the day in the eyes of the customer,” Robbiati explained during Friday’s Bank of America Merrill Lynch Leveraged Finance Brokers Conference, according to Seeking Alpha. “Everything else matters from an engineering standpoint, but in the eyes of the customer, you have three core metrics.”
The first metric is dropped calls, the second one is time on LTE, and the third one is the speed that is currently observed.
“And so when you look at dropped calls, Network Vision disrupted the equilibrium,” Robbiati explained. “And customers are very unforgiving, rightly so I should say. If they experience dropped calls, it’s highly frustrating for us, for every – each and every one of us, if we don’t have a network that performs and where the calls drop all the time. So, now our dropped call performance has improved materially. The benchmark in the industry is you have got to be below 1%. And so we were during the old days of Network Vision well above the 1%. Now, we are well below, we are at 0.6%, which is well below and trending further down. That’s really important.”
The second key metric is time on LTE.
“And that’s why this idea of using all the bands of the spectrum that we have is foundational,” he said. “And now, we have a very high percentage, above 90% of the time our customers are on LTE. This metric is really important because it’s a measure of the coverage that the network have. So, the wider the coverage, the better it is and also the quality of the coverage is better measured if the customer is on LTE as opposed to being a 3G. So that has been an enormous, enormous improvement and it has materialized truly in a very short space of time, because this tri-banding put it this way of the network started in July ‘14. So, it’s only a little bit less than 1.5 years ago. And now we are well done, we are well done by August ‘15 with that.”
The third metric is speed.
“And speed is an expression of the experience that you offer to customers,” Robbiati explained. “This can be on LTE, but is the end-to-end experience, including the backhaul for example, a bottleneck or is it really working very well. And our average speeds have been measured by RootMetrics, by Nielsen, and we are way up there at the very top in terms of the experience we provide and thanks to carrier aggregation. And the beauty of carrier aggregation is that it’s a technology that you can very rapidly deploy. It’s deployed by way of software upgrades. So, you don’t really need to roll trucks to update your network sites. There are too many of them to do that quickly. It’s done by software. It’s done by clusters of sites. So, you can quickly rollout carrier aggregation to optimize your network.”
In his short stint so far, Robbiati holds a very optimistic view of Sprint’s future.
“It’s a very unique situation, because it’s a very large company on a global scale, if you think about it, $32 billion of revenue is not small scale revenue,” he said. “And yet the company has had for a number of years failed to post a positive net income. And so when I look at this and I compare it from the prior experience in Australia with Telstra, which is a $20 billion of revenue, and you look at the free cash flow that Telstra generates, you say well there is a great opportunity there by way of trying to take cost out. And I do believe there is huge costs and de-leveraging opportunity at Sprint. The other thing that is quite unique for Sprint is really an incredible opportunity. It’s the pure amount of spectrum that Sprint has, but it’s down to us and our ability to cut cost and harness the power of the spectrum.”
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