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Sprint battles back by adding 967,000 customers

As all the carriers duke it out for consumers' affections, the gains last quarter keep Sprint just ahead of T-Mobile in terms of total customers.

Sprint is trying to hang on to third place in the carrier wars, above T-Mobile but below Verizon and AT&T. Lynn La/CNET

Sprint's latest promotions appear to be paying off, as the company added close to a million customers during its fiscal third quarter.

On Thursday, the carrier announced preliminary results for the quarter that ended December 31. Sprint said it added a net 967,000 new customers -- a number that included 30,000 net postpaid subscribers, 410,000 net prepaid users and 527,000 net wholesale additions.

The company's prepaid numbers take into account subsidiaries Boost Mobile and Virgin Mobile, while the wholesale category includes so-called mobile virtual network operators that piggyback on Sprint's network such as FreedomPop, Ting and Republic Wireless. Postpaid customers are subscribers who pay their monthly bills after the fact.

Every subscriber helps in the fierce competition among wireless carriers.

The additional 30,000 net postpaid customers is a much smaller number than the wholesale figure but is significant to Sprint. That's because Sprint had been losing such customers over the past several quarters. The growth in net postpaid customers was due to the highest number of gross postpaid additions in three years, Sprint said. The figure rose by 20 percent last quarter compared with the same quarter a year ago. In the preceding quarter, which ended September 30, Sprint added a net 590,000 overall customers, thanks in large part to its wholesale business.

To battle the three other major US mobile carriers, in particular T-Mobile, Sprint has been running an array of promotions under CEO Marcelo Claure, who took charge in August. The carrier has cut access fees on certain plans, upped the amount of data on some plans and tweaked its to let customers switch to a new iPhone each year.

The latest customer additions are also key because they keep Sprint in third place among US carriers, just ahead of T-Mobile but still well behind No. 1 Verizon and No. 2 AT&T.

On Wednesday, T-Mobile announced preliminary results for its most recent quarter and said it added 2.1 million customers, bringing its total base to more than 55 million. A Sprint spokesman said Thursday that the total number of subscribers reached around 56 million at the end of last quarter.

Earlier in the week, Verizon's CEO acknowledged that his company's churn rate -- or the rate at which people leave the service -- has gone up, though he sought to balance that by saying Verizon is still gaining and retaining high-value customers.

Sprint has struggled to keep existing customers and attract new ones, especially as it has been slow to upgrade its network -- hence the barrage of deals.

On Thursday, Consumer Intelligence Research Partners unveiled the results of surveys conducted over the last year -- and ending before the December quarter -- that delved into loyalty among mobile phone users. Verizon and AT&T have the most-loyal customers, while both Sprint and T-Mobile have lower loyalty rates, CIRP said.

"Based in either actual experience or perceived attributes, network-motivated switching accounts for almost 40 percent of Sprint and T-Mobile departing customers," CIRP co-founder and partner Mike Levin said in a statement. "These defectors are either dissatisfied with their current network or expect better connectivity from their new provider."

On the plus side, the Sprint users surveyed said they liked the features of their phone plans, such as unlimited data and friends and family pricing.

The company's most recent gains in customer numbers suggest that Sprint is working in the right direction.

"Sprint's first priority is a return to customer growth, and our results during the last quarter show we are on the right track," Claure said in a statement. "While we still have work to do, it is clear that our aggressive actions to provide customers with the best value in wireless are gaining momentum."

Sprint said it will announce full results for the December quarter sometime in February.

Correction, 1:22 p.m. PT: This story initially misstated the companies in the prepaid and wholesale categories.