Sprint CEO Dan Hesse said he is cutting his salary to allay investors concerns about the high cost of the iPhone, according to a Reuters’ report. Hesse will give up a total of $3,250,830 in incentive compensation from 2011 and 2012 to offset the high cost of the Apple smartphone.
It is thought that Sprint pays a 40 percent subsidy for the iPhone (about $200 per device), which is much more than it pays for competing devices. Sprint is expected to foot a $20 billion bill for carrying the iPhone over the next four years and won’t start making money on the device until 2014. This record high subsidy is pushing up costs for the carrier, even as it adds new subscribers and increases its postpaid ARPU.
[Via Reuters]