NEW YORK-Speaking at its annual investment community meeting in New York a day after reporting fourth-quarter and full-year 2003 results, Sprint Corp. said it expects service revenues in its wireless division to increase in the high-single digits this year, driven by a larger customer base, stable average revenue per user aided by increased contribution from data services and a strong gain in wholesale services.
Sprint also said it expects wireless losses per share of between 13 cents and 18 cents this year, with results turning to a return of 20 cents to 30 cents per share in 2005. The company’s wireless division posted a loss of 66 cents per share last year, which was a 14-percent increase from the 58 cents per-share loss Sprint PCS reported in 2002.
Sprint added it expects wireless capital expenditures to increase to $2.4 billion this year from the $2.15 billion spent in 2003, with the increased spending targeted at both improving network capacity and coverage and providing new capabilities.
Sprint also announced a five-year, multibillion dollar customer-service agreement with IBM Business Consulting Services as part of what the telecommunications company said was the core of its new customer-service strategy designed to “significantly improve its customers’ service experience.” The outsourcing arrangement is expected to save Sprint $550 million over the next three years.
In addition to the outsourcing of customer care, IBM will also take over management of Sprint’s existing vendor-operated call centers and will assume management of the Sprint-owned Nashville, Tenn., call center. Sprint said it would continue to operate its remaining customer-service centers.
In a related deal, customer-care service and billing provider Convergys Corp. signed a five-year agreement with IBM to provide customer-care services as part of IBM’s deal with Sprint. Convergys said the deal includes assuming responsibility for Sprint’s Nashville customer-care facility and its 1,100 current employees.
Convergys announced last year that it had signed an agreement with Sprint PCS to support the carrier’s plan to move its billing system, which Convergys previously had provided in-house to Sprint. Those plans were eventually scrapped late last year.
