$100 MM to Launch Sprint Samsung Instinct

The Samsung Instinct launches this week on Sprint. Some people are calling it the iPhone killer on Sprint. The price is roughly the same or even less and the service plan is roughly comparable. I won’t bore you with the details, there are plenty of sites talking about it. Also, Sprint was clever to launch the Samsung Instinct a few weeks before the Apple iPhone (June 20th compared to July 11th, respectively).

Here are some interesting facts that may not have been highlighted by others bloggers, journalist, etc.

Sprint is spending close to $100 million USD on the total launch of the device. My source (JS) who sells Sprint devices told me that there has been lots of training on the device and the new services. Looking at the commercials, a special Instinct website, and all the posters, and hype, I can believe the money trying to promote this device.

AT&T launched streaming TV and is a key feature on the LG Vu and Samsung Access. However, in the market where I reside, the San Francisco Bay Area, it is not yet available, so this is where Sprint has an advantage. Also, I don’t believe that the Apple iPhone will have the streaming live TV service available when it ships.

While the new Samsung Instinct is faster than the old iPhone for data speeds, this has more to do with the network than the device. While using an AT&T data card, I have noticed that the 3G network is a bit more spotty and inconsistent for data in comparison to Sprint’s EVDO network. While HSPDA has theoretical maximums of 7.2Mbps compared to the maximum on EVDO Rev A of 3.1Mbps, you are more likely to get higher average speeds on Sprint for now. AT&T is still upgrading its network so the speeds will get more consistent and faster over time.

Calculating Success

I am looking forward to see how well the Instinct sells. Each subscriber earns Sprint a gross of $1810.

$130 for the device $70 per month x 24 months (full service contract) $1810 per subscriber

Sprint will need to sell about 55,250 devices to break even. With Sprint claiming to have 1400 retail locations, not including dealers and resellers, each location would need to sell about 40 devices.

$100,000,000 divided by $1810 = 55,250 units 55,250 units divided by 1400 retail stores Equates to 40 devices per store

The number of devices sold per store goes down if the Sales Consultant can sign up a subscriber to the Sprint Simply Everything Plan.

Parting Thoughts

One gotcha that could bite Sprint is the launch date. The Samsung Instinct launches on June 20th and Sprint has a 30 day return policy, that would put the trial period until a minimum of July 19th. If everything goes optimally, that gives potential subscribers an overlap of 8 days to try out the Apple iPhone and see what is the better device for them. But chances are that you might not even be able to get your hands on the new iPhone to compare! Had the device been launched a week earlier, the might cause less potential returns. Also will the Instinct launch under a different model name for GSM carriers outside the US? Finally, it will still be some time before an unlock patch for iPhone devices will come out and be usable in other parts of the world, so there are more choices to cogitate than ever. Best of luck in upgrading to your new mobile device!