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    Sprint iPhone to be a 'multibillion dollar gamble,' says WSJ

    Sprint iPhone to be a 'multibillion dollar gamble,' says WSJ

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    In order to get the iPhone, Sprint had to promise Apple it would buy some 30.5 million handsets over the next four years at total cost of $20 billion.

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    sprint iphone 4

    We've been hearing about the iPhone coming to Sprint for so long now that it feels almost inevitable, but that wasn't necessarily the case behind the scenes, according to the Wall Street Journal. In order to get the device, Sprint had to promise Apple it would buy some 30.5 million iPhones over the next four years at total cost of $20 billion -- a "bet-the-company" deal that may not make the number-three carrier any money until 2014. Even still, CEO Dan Hesse convinced his board of directors that Sprint simply couldn't compete without Apple's latest phone -- he's previously said desire for the iPhone is the "number 1 reason customers leave or switch."

    Assuming Sprint does get the phone under these terms, the math isn't actually terrible. Sprint would have to sell just under eight million iPhones a year to meet its commitment, and the company's latest financials indicate that some nine percent of subscribers upgrade each quarter, or around 12 million a year. Assuming the carrier can sell just four million iPhones a year to those upgraders, it'll have to take just another four million customers away from AT&T and Verizon -- about a quarter of yearly US iPhone sales. That doesn't seem too impossible, especially given Sprint's aggressively-priced unlimited data plans -- plans Dan Hesse has pledged to keep.

    Of course, all of this could backfire -- if Apple doesn't release a major update to the iPhone it's hard to see a lot of iPhone 4 owners switching up, and Sprint may or may not have the ability to survive if it doesn't make all these numbers work. We'll find out tomorrow.