Some Important Information on Handset Rollout--Sprint/Radio Shack:
I am taking the liberty of posting this which was on the Motley Fool thread, because it has important information about the marketing of the new phones and when the campaign might start:. I am posting the entire message to be fair to the originator.
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Subj: Re: Sprint Advertising Roll-out.
Date: 21 Aug 1997 17:23:24 EDT
From: GriffinMrX
Message-ID:
I thought I would add information regarding Sprints order of Q phones to ship in a few months. Sprint PCS will launch a nationwide advertising campaign on September 25th that will continue through October and end some time in mid-November. Sprint PCS selected Radio Shack as its distribution partner and will refer to Radio Shack as "America's telephone store" in the same campaign. If you go to your local Radio Shack, (there is one within 15 minutes of 95% of the US population), the build-out for its telephone store-within-a store concept should either be complete or close to it to coincide with the advertising launch (Sprint PCS has appropriated a significant amount of money towards this advertising campaign ($50M over the entire year if I recall correctly). 4,800 (out of 6,800) of the Radio Shacks will have their stores stocked and ready with equipment (such as the Q phone) in anticipation of this nationwide campaign.
Radio Shack had Primeco, AT&T and others drooling to joint venture this deal. They chose Sprint PCS because A) less than 10% of their current customer base is Sprint PCS and B) >70% of their customer base is AT&T. Radio Shack gets a residual income stream from all services sold in its stores to new Sprint Customers that purchase equipment and/or service inside a Radio Shack. Since a majority of its customer base was already AT&T, a "new" AT&T customer would be few and far between where as 9 out of 10 customers will not be Sprint customers when they enter the store [if just 1 out of 10 converts on the way out, then it is icing on the cake for Tandy (Radio Shack).] People are just now starting to figure out that this residual could approximate 5-10 million of royalty income to Tandy just to let Sprint PCS use its store (i.e. its distribution line). This would come out to $1.20 or so per share for Tandy shareholders which has not been factored into current estimates. Investors are finally beginning to put it together as TAN has moved 20% this past month (see their stock chart, this, like QCOM may be triple figures in 98 (more confident about TAN though). {This last paragraph to emphasize Shack's powerful distribution line which will be selling Q phones and other CDMA phones this fall!}
Anyway, I bring all this up to illustrate the gravy train effect it will likely have on Qualcomm and its product. As long as Sprint PCS continues to order from Q, Q will finally demonstrate to the market that they can indeed sell and market their own product. Think about the timeline. Sprint PCS advertises for 8 straight weeks on their nickel that now is the time to get a PCS quality phone and their network will be in most major cities by year-end. Q phones are sold during this time. Add to this advertising Q's advertising campaign. Then add the golden quarter (4th quarter retail calendar year-end) for Radio Shack and wherever else the Q phone might be selling). Then the Superbowl at where? Qualcomm Stadium! Who might advertise there? hmmm...Qualcomm, Sprint, although Radio Shack is doubtful.
Kind of long-winded but thought it might be useful so anyone thinking of jumping ship now should wait until the Miami Dolphins win the Super Bowl (wishful thinking on my part).
Would like to see another positive announcement soon.
GriffinMRX
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