Sprint - Nextel 2015 Annual Report Download - page 28

Table of Contents
Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations
OVERVIEW
Business Overview
Sprint is a communications company offering a comprehensive range of wireless and wireline communications products and services that are designed
to meet the needs of individual consumers, businesses, government subscribers, and resellers. Unless the context otherwise requires, references to "Sprint," "we,"
"us," "our" and the "Company" mean Sprint Corporation and its consolidated subsidiaries for all periods presented, inclusive of Successor and Predecessor periods,
and references to "Sprint Communications" are to Sprint Communications, Inc. and its consolidated subsidiaries.
Wireless segment earnings represented almost all of our total consolidated segment earnings for the year ended March 31, 2016 . Within the Wireless
segment, postpaid wireless service revenue represents the most significant contributor to earnings, and is driven by the number of postpaid subscribers to our
services, as well as the average revenue per user (ARPU).
Strategies and Key Priorities
Our business strategy is to be responsive to changing customer mobility demands of existing and potential customers, and to expand our business into
new areas of customer value and economic opportunity through innovation and differentiation. To help lay the foundation for these future growth opportunities,
our strategy revolves around targeted investment, in the following key priority areas:
• Provide a network that delivers the consistent reliability, capacity and speed that customers demand;
• Achieve a more competitive cost position in the industry through simplification;
• Increase subscriber acquisition and retention and reduce churn;
•Create an alternative financial structure to fuel growth and maximize shareholder value;
• Attract and retain the best talent in the industry; and
• Deliver a simplified and improved customer experience.
To achieve these key priorities we are focusing on the following initiatives. To provide a network that delivers the consistent reliability, capacity and
speed that customers demand, we expect to continue to optimize our 3G data network and invest in LTE deployment across all of our spectrum bands. We also
expect to deploy new technologies that will help strengthen our competitive position, including the expected use of Voice over LTE, more extensive use of Wi-Fi
and the use of small cells to further densify our network.
To achieve a more competitive cost position, we have established an Office of Cost Management with responsibility for identifying, operationalizing,
and monitoring sustained improvements in operating costs and efficiencies. Also, we have deployed new cost management and planning tools across the entire
organization to more effectively monitor expenditures.
We are focused on attracting and retaining subscribers by improving our sales and marketing initiatives. We have expanded our direct retail store
presence through our relationship with RadioShack, as well as our Direct to You service that brings the Sprint store experience to our customers. We have
demonstrated our value proposition through our new price plans, promotions, and payment programs and have deployed new local marketing and civic engagement
initiatives in key markets.
Our alternative financial structure consists of transactions that leverage our assets such as the Handset Sale-leaseback Tranche 1 we entered into in
November 2015 and the Network Equipment Sale-Leaseback, Handset Sale-Leaseback Tranche 2 and new unsecured financing facility we recently executed,
described in more detail in "Liquidity and Capital Resources." In addition, we continue to identify other funding sources such as the potential monetization of
certain spectrum holdings or certain real estate. In addition, with the Office of Cost Management, we have commenced major cost cutting initiatives to reduce
operating expenses and improve our operating cash flows.
We seek to build a stronger management team by attracting new outside talent with world class experience and credentials while retaining selected
members of the incumbent management team. We recently began operating in a regional model that will put key leadership closer to customers and allow us to
better serve them in four geographic areas which are comprised of seventeen regions.
To deliver a simplified and improved customer experience, we are focusing on key subscriber touch points, pursuing process improvements and
deploying platforms to simplify and enhance the interactions between us and our
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