Sprint to sell iPhone 5 in October, report says

Sprint Nextel may finally be getting the iPhone.

The Wall Street Journal, citing anonymous sources, reported today that the nation's third-largest wireless carrier will begin selling the iPhone 5 alongside Verizon Wireless and AT&T in mid-October.

Gaining access to the iPhone would represent a major victory for Sprint. Selling Apple's smartphone would put the carrier--which lags behind its larger rivals--on relatively equal footing with Verizon and AT&T. Exclusively offering the iPhone had, for years, been a massive advantage for AT&T, until Verizon began selling its version of the device earlier this year. Both U.S. wireless carriers have seen tremendous growth in subscribers since beginning to offer the uberpopular phone.

Apple, meanwhile, would get an additional retail channel to sell its device. It would also put Apple's iPhone on all the major U.S. carriers, assuming AT&T completes its planned acquisition of T-Mobile USA.

A Sprint representative declined to comment to CNET. An Apple representative wasn't immediately able to respond to CNET.

The Journal also reported that Sprint would sell the iPhone 4, in line with Apple's strategy of selling a cheaper version of its previous-generation iPhone to further broaden its customer base. That corroborates a separate report from Reuters earlier today claiming Apple is cooking upa budget-priced, 8-gigabyte model of its iPhone 4 to sell alongside its next-generation phone.

The iPhone has been a particularly annoying foil for Sprint. Despite launching a number of capable devices, including its top-selling HTC Evo and the follow-up Evo 3D, there remained questions about whether the carrier would ultimately offer the iPhone. It was a question Chief Executive Dan Hesse has consistently sidestepped. At the same time, he has hinted at the increasing competitive pressure Sprint has faced from both of the company's larger rivals.

Sprint also may have the unique position of selling the iPhone with an unlimited-data plan for new customers, now that AT&T and Verizon have switched to tiered pricing structures. Customers concerned about their heavy data use may see Sprint as a more attractive destination.

The growth may come at a high cost. J.P. Morgan analyst Philip Cusick predicted that Sprint would have to pay a dramatically higher amount of subsidies to cover the cost of the iPhone. He estimates that the carrier pays a $250 subsidy for 4G smartphones and $150 subsidy for 3G ones. The iPhone, meanwhile, has a subsidy closer to $400 to $425 at AT&T, he said.

If Sprint gets both the iPhone 5 and iPhone 4, Cusick estimates that they could make up close to a third of handset sales for the fourth quarter and 2012.

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• Rumor: Apple doing advanced testing for Sprint iPhone
• Job posting hints at Sprint iPhone

This is the latest in a series of hints and reports suggesting that Apple and Sprint have been working together to offer a Sprint-based iPhone.

A job posting from Apple that surfaced in early May sought a new member of the company's carrier engineering team based in Kansas City, home of Sprint's headquarters. A month later, a report claimed that Apple was in advanced testing stages with an iPhone compatible with Sprint's CDMA network.

Apple released the CDMA version of the iPhone for Verizon's network in February, marking the first such device from the gadget maker to depart from the GSM bands. Verizon Communications Chief Financial Officer Fran Shammo hinted in April that the next iPhone would be a global device, suggesting that it would be able to work on multiple carriers, regardless of the wireless technology. Citing usage logs from an anonymous iOS developer, TechCrunch last night reported that such a device was already in testing.

In its most recent quarterly earnings call, Apple noted the iPhone was available on 228 carriers in 105 countries. More recently attention has been focused on Apple's expansion in China, with the company said to be in talks with Chinese carriers China Mobile and China Telecom to expand its presence in the country. China Mobile Chairman Wang Jianzhou last week confirmed he had met with Apple CEO Steve Jobs several times, but had not yet struck an agreement that would make Apple's iPhone available to the company's 618.8 million subscribers.

Updated at 1:36 p.m. PT with additional background and details.