Sprint Shareholders Win as Hesse Ignores Whitworth

Who can forget Ralph Witworth's ill timed foray into Home Depot (HD) and the carnage that ensued for shareholders. At least Sprint (S) seems to have learned from history and gave his demands their due course, the garbage can.

In February I begged Sprint's new CEO Dan Hesse to ignore Withworth's call to abandon the WiMax effort and spin off the long distance unit.

Out Wednesday from the Journal, Comcast (CMCSA) and Time Warner Cable (TWC) are considering providing funding for a new wireless company that would be operated by both Sprint and Clearwire (CLWR).

The new venture would create a nationwide wireless network using Sprint's WiMax technology. The goal is to provide high-speed Web access and high-quality mobile video to laptops, cellphones and other mobile devices. Sprint and Clearwire have been working for months on WiMax have looked to raise at least $3 billion for a joint venture.

Comcast, Time Warner Cable and Bright House Networks are rumored to be contributing $1.7 billion to the new company.

This does some very important things:

1. Begins "tying up loose ends" at Sprint for any potential buyer. With all the uncertainty surrounding the effort, potential buyers have been staying at arm's length. With this cleared up, a price for the company can be more easily attained.
2. Sprint Network: Sprint already has a far superior network to rival AT&T (T), its problems have been customer service related. As mobile web-browsing becomes more prevalent, the best network has the clear advantage. As this is rolled-out, that will be Sprint.

Rather than listening to Whitworth, Hesse ignored his calls to either abandon, sell or otherwise dispose of the WiMax effort and instead seems to be on the cusp of making it the future of the company. Good for him...

Disclosure: No position.

Comments

[mmcookie72:]

This Whitworth fella has no idea about the day to day operations of Sprint. They are trying to control cost be putting the wireless traffic on the company lond distance network. PCS and Nextel used to order their circuits from whoever could get it to them the fastest. Now Sprint has deployed MAN rings to pickup their traffic and take it to an LD switch or selected LEC/Verizon central offices. If they sold the Long Distance division their cost would skyrocket because of the access fees that have to be paid to LEC/Verizon, the MAN equipment cuts the cost in half. Sprint has a huge network and good offerings, but as I hear all the time the phones are not great and the customer service sucks. I personally have never had a problem with customer service, but then again I try not to act like an ass with them either.

2008 Mar 31 03:57 PM

[sweetpea:]

All wireless providers use their traditional wireline/long distance networks to connect cell towers. The advantage that Sprint (and T and VZ) have is that they own the networks. The scenario you suggest is not a bad thing.

2008 Apr 01 09:18 AM

[MobileMortg...:]

Now your talking. Sprint is faster.. And the beauty of whats wrong with sprint for the most part is its customer service... and thats human...and we can fix human... well most ... so comparing this issue to a faster Wimax platform with new Iphone devices with more capabilities...

Hello..... McFly...... Buy BUY BUY>>..

2008 Apr 01 05:16 PM

[Geddy:]

Sprint faster at what? They haven't built a single thing yet with regards to WiMax (not including the supposed Chicago market where for some reason they've not released to the the public yet-usually a "cry for help" scenario meaning they're having problems with it). I don't think it's all customer service issues when you lose that many customers in a year (by far the most ever in wireless history) so to just improve customer service won't fix it all. I think it's a big mistake for Sprint to not go back to basics & stop their customers from leaving before trying to branch off into unproven technologies...that's just me though! :)

2008 Apr 01 05:55 PM

[xnext:]

While pursuit of WiMax is a worthy goal, Sprint needs to concentrate on the fundamentals (existing network integrity, customer service, cost reduction) than going into another exceedingly capital intensive effort. Plus, they need to eviscerate the labyrinthian bureaucracy in OP. Credibility with subscribers, shareholders and the marketplace needs to be restored, before pursuing risky, unproven technology. If no one trusts you to do the right thing now, what makes you think they will with WiMax?

2008 Apr 01 09:16 PM

[your dad:]

The company is fixing customer service, upgrading existing network as well as building out wimax. Look, nokia just signed on. I am sick of the sky is falling tude. you guys watch CBS news way too much. How do you know they havent built a single thing? it takes more than a steel tower in the air to provide wimax. There are videos on you tube of some guys doing a video conference over wimax. I would say that proves its worth.

2008 Apr 02 09:34 AM

[Geddy:]

They've supposedly built a market in Chicago but as you have/haven't seen it's not available to consumers. Talking about watching CBS, you're own foolish statement says you watch "you tube (oh believe me, a VERY legitimate source of news!)" to get your information. Try reading a book! Tell you what, I'll stamp a WiMax sticker on my modem, post a video to you tube showing me surfing the internet, & become a viable news source...good for you?

2008 Apr 02 01:15 PM

[your dad:]

Geddy, It was a real live company demonstration. I don't get my news from you tube but I did see a really nice wimax demonstration there. If you do stamp your modem, please put a "libtard" stamp on it. You are a liberal scum bag.

2008 Apr 02 01:57 PM

[your dad:]

Todd, you are right! so far Hesse has kept Whitworth quiet. As long as they can keep a ball gag in that libtards mouth everyone wins.

2008 Apr 02 02:00 PM

[xnext:]

Seems like the nazi-cons who run Sprint haven't done so great either. Although I do agree that Whitworth was only given a board seat to appease him. His track record with other companies sucks.

2008 Apr 02 07:14 PM

[your dad:]

His track record sucks and his ideas for Sprint suck. Whitworth really has no place on the board. VZ just spent 9 Billion to get the 700 spectrum. I wonder how they plan on paying for it. Whitworth, you should go to new york and tell them!!

2008 Apr 02 11:23 PM

[Geddy:]

your dad...wow, way to back track on your previous comment where you did indeed say you saw the demonstration on you tube. I'll stamp my modem as "I'm with stupid" so you'll know I'm talking specifically to you.

Yeah, I see VZ having a hard time coming up with 9 billion (actually 9.9 billion to be more accurate)...right! LTE will blow by WiMax and leave Sprint/Clearwire in it's wake yet again...wait, they're already there!

2008 Apr 03 10:37 AM

[your dad:]

LTE is still 4 or 5 years away. wimax is here today. Not only do you not understand the industry, you don't understand the technology. There is not 1 device for LTE yet. Here is the link: www.youtube.com/watch?...
It looks plenty real to me. I still say I saw the demonstration on you tube and now you can too.

2008 Apr 03 03:57 PM

[Geddy:]

Still working in the industry, I can promise you LTE will be here by 2010 so 4-5 years is a pipedream wish by you weak WiMax folks. WiMax HAS STILL NOT LAUNCHED AND DOES NOT HAVE A SINGLE PAYING CONSUMER ON IT YET. You might need to do some more searching on you tube to update your news bud. As a matter of fact Sprint just delayed their commercial launch yet again from April until "sometime later this year." Sounds like trouble to me...

I also beg to differ that any LTE devices have been tested. Again, might want to search you tube (since it's your new source) for the demonstrations Ericsson & Nokia have done. Here's a link for you to peruse, & no it's not from you tube!

www.cio.com/article/32...

2008 Apr 03 04:50 PM

[your dad:]

Why? LTE sucks.

2008 Apr 03 05:46 PM

[Geddy:]

That pretty much confirms it...you're either a "Sprextel" or Clearwire employee. Good luck there bud!

While you're perusing good news about either one, try this one. Amazing the number of people that love them.

clearwiresucks.com/blo.../

2008 Apr 04 12:57 PM

[your dad:]

LTE still sucks.

2008 Apr 04 02:06 PM

[your dad:]

I dont work for either company. I bet you work for Qualcomm though. Either way, its easy to defend a technology that is still an idea on paper. Look, wimax and lte are similar but wimax is an open standard. And thats why I like it.

2008 Apr 04 02:19 PM

[Geddy:]

Again, need to do more research. ALL 4G technology is required to be open standard and every MAJOR wireless carrier has committed to it already. I don't work for any vendor but do work for a major wireless carrier...& I'm sure you guessed it's not Sprint or Clearwire thank god (though I did work for Clearwire in 2006 until I found out how shoddy that company was). Here's a bit more of a tidbit on the supposed "technology on paper" you mentioned. All you've seen is a lab demonstration of WiMax at work, which UMB & LTE have also been proven to do (work in a lab). I still have not seen a single paying consumer using WiMax in the US yet.

AT&T made the same announcement yesterday...

www.wirelessweek.com/V...

2008 Apr 04 02:26 PM

[Geddy:]

You tell 'em Geddy! Dude's a dumb $%#^!

2008 Apr 04 08:10 PM

[Glad Im gone:]

Well I worked for sprint for over 4yrs and recently Quit with in the last week.. This comany ain't going no where all you do is run around and plug holes for problems that other people have created.

You got idots on the board, you got a CEO who came in and cut people to the bone.

1: No Raises this year company wide..
2: Hiring Freeze Most of the Company
3: Idots on the Board, wait I alrdy said that
4: Worst Customer Service in the world
5: WIMAX "The Myth" Greates Crock for Sprint Ever
6: 2G Phone "I will copy Apple Some how"
7: Sales Force "Graduates of LSC University" LSC= LIE STILL CHEAT
8: Senior Managment "Brushing up there Resume's while at work"
9: 32B Write OFF AKA NEXTEL"NOBODY REALY USES ANYMORE"
10: Last But Not Least "Senior Officers Removed" Worst mistake of all mistakes..

My conclusion, mark my words people, and mark them well this is the colapse of a Major Corporation.. Wont be the first I have worked for and I hope its the last..

PS. Wait for the Quaterly Report to come out next for the loss of customer base.. Cant say much more but its going to be a big number....
Almost forgot No div on shares LMAO what a company.. Im shame I stuck around the last year.

2008 Apr 08 07:28 AM

[Nextel Acce...:]

WiMax is the shizzle...

2008 Apr 17 02:04 PM

[Geddy:]

WiMax sucks!

2008 Apr 17 04:37 PM