WSJ: Sprint Is Betting $20 Billion on the iPhone

For Sprint, it all comes down to Apple. With the new iPhone ready for debut tomorrow, sources at the Wall Street Journal say that Sprint forked over a cool $20 billion to get in on the action. The decision could make or break the carrier.

Sprint's reportedly bracing itself to lose plenty of money on the deal, too. Old Yeller committed $20 billion to buying 30.5 million iPhones, and those units will have to make it to customers. It's not impossible, but to do that, they need to subsidize their iPhones heavily in order to be competitive. Making that kind of money back will take years—till about 2014, sources say—and if the iPhone doesn't succeed for them they'll be in even hotter water than they're in now.

Sprint is effectively betting everything on a single phone with this deal. It's a major risk since they're simply not as rich as the competition. And they likely won't see the benefits for a good while. [WSJ]


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