Sprint customer drain continues in Q4, 1.3 million leave

This morning, Sprint Nextel reported its fourth quarter earnings, or more accurately, losses. The wireless operator posted a $1.2 billion loss for the quarter, a 14.4% drop in revenue, and a loss of 1.3 million customers.

"In tough economic times, we're generating substantial cash and reducing costs to ensure we remain financially sound," said Sprint Nextel CEO Dan Hesse in a statement this morning. "We already have the cash on hand to be able to meet our debt service requirements at least through the end of 2010."

Sprint may have a strong cash flow, reporting over $500 million in the fourth quarter, but is seriously bleeding customers. For the full year 2008, it lost more than a million customers per quarter, closing out the year with 4.5 million fewer subscribers than 2007.

The number of departures is almost equal to Sprint Nextel's total "Power Source" base, or customers who utilize both the Sprint CDMA network an the Nextel iDEN network, which is 1.4 million. CDMA-only subscribers amounts to 35.5 million, and iDEN-only amounts to 12.4 million.

The year 2009 is sure to be a dramatic one for Sprint Nextel, as it will be the exclusive carrier for another company's golden goose, the Palm Pre. Both Palm and Sprint have become the underdogs of their respective markets, with Sprint now the smallest of the four major US wireless carriers, and Palm starting over from scratch in the mobile OS department. If the excitement over Palm's new product continues, maybe Sprint Nextel can finally start attracting new subscribers instead of scaring them off.