Sprint stock plunges; may need money to pay for LTE upgrade

On Friday, Sprint announced that it would be launching a new LTE-based 4G wireless network beginning sometime in 2012. That would normally be good news; indeed, the stock price for the company rose up by as much as 13 percent during the day on Friday. But then Sprint dropped a bomb, claiming it might need to raise more money in order to fund the LTE network, that didn't please investors and sent Sprint's stock price plunging down nearly 20 percent before closing at just $2.41 a share.

Sprint admitted that it would phase out its current WiMax network, which it launched back in 2008, by the end of 2012. PCWorld.com reports that Sprint will continue to sell smartphones and other devices with WiMax support until the end of 2012. Sprint launched the WiMax network with Clearwire but has since stopped adding new US markets for WiMax, and partially as a result, Clearwire's stock price dropped even more than Sprint's in Friday's trading, going down a whopping 32 percent. While Clearwire is an independent company, Sprint is still its largest customer and any reduction in support could be trouble for Clearwire's future.

Sprint hopes to have up to 120 million people under its LTE-based network by the end of 2012, and 250 million people in the US by the end of 2013, but the fact that the company might have to look for some outside funding to pay for the new network could also be a problem for Sprint as it tries to compete with Verizon and AT&T.

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