Sprint Nextel (S) hasn’t felt any serious, long-term pain from Apple’s (AAPL) $200 iPhone price cut, says chief Gary Forsee (translation: they’ve felt annoying near-term pain). In a conversation with Goldman Sachs wireless analyst Jason Armstrong, Forsee acknowledged a spike in Sprint subscribers leaving for rival AT&T (Apple’s exclusive U.S. iPhone carrier) after the surprise price cut. But Forsee says the exodus was less than during the iPhone’s initial launch in late June and that the rate of subscribers leaving the carrier has returned to normal levels.
Update: Meanwhile, AT&T exec Ralph de la Vega says the price cut has led to a “significant uptake” in business. No clarification whether this was a short-term spike or sustained growth. And are those subscribers coming from other carriers or are they existing AT&T customers upgrading their phones?
Forsee also said he doesn’t expect much impact on the wireless industry from any potential economic weakness. For two reasons, however, we think Sprint could be vulnerable during a housing-market downturn:
- We believe the construction industry represents a meaningful portion of Nextel’s walkie-talkie subscriber base.
- Sprint has had problems recently with “involuntary churn,” or low-credit subscribers getting booted from the service because they are not paying bills.
On both issues, Forsee insists Sprint is no more or less exposed than other carriers.