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Sprint's CEO says deals like Verizon's Yahoo purchase never work out

Marcelo Claure says his video strategy is smarter: Offering unlimited data, not buying content.

Sprint CEO Marcelo Claure, speaking at the 2015 Code Conference.
Sprint CEO Marcelo Claure
Asa Mathat

Sprint CEO Marcelo Claure said Monday that Verizon’s purchase of Yahoo is just the latest in a long history of deals by telecom firms trying to get into the content business, none of which have panned out.

“History has proven that every single one of them has failed,” Claure said on a conference call with reporters following the company’s quarterly earnings report.

AT&T has gobbled up DirecTV while Verizon has been buying up internet giants AOL and now Yahoo and trying to prop up its Go90 video service.

“We like when we see our [competitors] take their eye off their core business,” Claure said. He took a shot at Go90, saying it has set some sort of record for least amount of return for the amount of money Verizon has spent.

As for Sprint’s video strategy, Claure said his focus is on giving customers unlimited data and letting them choose what video content they want to watch. However, Sprint has been raising the price of such plans, which once were offered for as little as $50 per month but now cost $75 monthly for new customers.

T-Mobile, meanwhile, has its Binge On program, which offers customers the ability to view video from Netflix, Hulu and a host of other video services at reduced quality without using any data from their monthly allotment.

One concern for Sprint has been that parent company SoftBank’s $32 billion deal to acquire chipmaker ARM will leave little capital to invest further in Sprint or to fund a potential deal to acquire T-Mobile.

Claure put a positive spin on the deal, noting that SoftBank chief Masayoshi Son wouldn’t have bought ARM unless he was convinced Sprint was on solid footing.

“We are really not even thinking about T-Mobile,” Claure said.

Sprint’s quarterly earnings and revenue were generally in line with what analysts were expecting as the company added 377,000 customers, including 173,000 of the most lucrative type — those of the non-prepaid variety.

Shares of Sprint were trading Monday at $5.49, up 87 cents or 18 percent.

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