Sprint CEO: We're glad we waited on Android
PASADENA, Calif.—Sprint CEO Dan Hesse talked a lot about the mobile operating system he held off on—Android—and not so much about the phone he has backed, Palm's Pre. — Hesse said Friday here at Fortune's Brainstorm …
Context & Ripple Effects
Hesse has been managing the same tension all year: back in March he told reporters the Palm Pre still wasn't ready for launch even as Sprint positioned itself as the phone's exclusive carrier. Now, with roughly 350,000 units sold in seven weeks by RBC's count, his argument at Fortune's Brainstorm Tech inverts the usual carrier logic — he says skipping Android was the right call, and talked about the OS he passed on more than the phone he bet on.
The framing matters because Sprint's rivals are scaling Android across multiple devices while Sprint's differentiation hangs on a single exclusive handset from a financially strained Palm. Unconfirmed reports from May about a network-management outsourcing deal with Ericsson that could shift 5,000–7,000 U.S. employees add to the picture of a carrier trimming costs while it waits on its handset bet.
First-order effects
- Sprint's smartphone lineup remains anchored to one exclusive device — the Pre — so its subscriber pitch against Android-carrying rivals depends on Palm shipping enough inventory and follow-up hardware, with replenishment reportedly already tight at stores (unconfirmed).
- Hesse's public defense of waiting gives him cover to adopt Android later on Sprint's terms rather than as a catch-up move, since he can frame any future Android handset as opportunistic rather than late.
Second-order effects
- If Android keeps spreading across carriers and price tiers, Palm's leverage in the relationship erodes and Sprint faces pressure to diversify its lineup — turning the exclusivity that defined the Pre launch into a single-supplier risk.
- Competing carriers can use Sprint's wait-and-see stance in marketing, positioning their broad Android catalogs as proof that openness beats exclusivity for consumer choice.
Third-order effects
- The episode is an early instance of U.S. carriers acting as de facto kingmakers for mobile operating systems — where a carrier's endorsement and shelf space, not just the device maker's engineering, decides whether an OS reaches scale.
- If exclusivity-driven launches keep working for smaller carriers, expect more premium payments for exclusive handsets and a market where OS vendors court distribution partners as aggressively as consumers.
The trend: U.S. wireless carriers are consolidating into gatekeepers whose exclusive-device deals, not handset makers alone, determine which mobile operating systems achieve mainstream scale.