Sprint Reveals iPhone Details

Sprint Nextel posted a narrower third-quarter loss and revealed that its costly deal with Apple means the wireless carrier likely won't turn a profit on the iPhone before 2015.

Sprint said that its agreement with Apple will cost it at least $15.5 billion over four years, limiting its ability to turn a profit in that time. While Sprint expects iPhone customers ultimately to be more profitable than those using other smartphones, the cost to bring them aboard will be 40% higher. Sprint said it faces a cash shortfall of up to $2.2 billion next year and $5.2 billion in 2013 as it buys millions of iPhones and spends about $5 billion to upgrade its network to a fourth-generation standard similar to that used by rivals AT&T and Verizon Wireless. It will need to raise as much as $7 billion for its operations, including through a $4 billion debt refinancing and up to $3 billion in vendor financing. Sprint is racing to keep pace with its two larger rivals who have already introduced the latest 4G networks and are adding lucrative contract customers. That's left Sprint hamstrung with sizable upfront costs to build its own new network from the ground up and to offer users the top-selling iPhone. Until deciding to build its own 4G network, Sprint had depended on Clearwire to provide the high-speed service. Sprint said it had an initial agreement with its partner for a new network-sharing arrangement for beyond 2012.