Hello! And welcome to our Friday column, Worst of the Week. There’s a lot of nutty stuff that goes on in this industry, so this column is a chance for us at RCRWireless.com to rant and rave about whatever rubs us the wrong way. We hope you enjoy it!
And without further ado:
Man, is there not a more confounding company in the domestic wireless industry than Sprint Nextel? I mean is there a company that makes more screwball decisions that were then horribly executed? Nokia? Microsoft? Research In Motion? Palm? Motorola? I think Sprint Nextel has them all beat.
What makes this more frustrating for me is that I really want to like Sprint Nextel. I don’t mean in a Facebook sort of way, or even in a sort of I think the carrier is sort of cute kind of way. I just want Sprint Nextel to be a viable No. 3 operator in an industry that seems to be increasingly only about No. 1 and No. 2 (he he). You know, I want to root for an underdog that is worth rooting for.
And that is where Sprint Nextel is making it so difficult.
It would be one thing if Sprint Nextel had been making good decisions over the past 10 years and somehow found itself in its current predicament despite those best intentions. But, looking at those decisions made by various leadership collectives, it’s easy to see that many were just head-scratchers belying sane logic.
For the moment, I will forgive all decisions made until the 21st Century, though its initial founding based on building out a nationwide wireless network using 1.9 GHz spectrum that was always going to provide inferior network coverage to the incumbents that were given their 850 MHz spectrum chunks is hard to overlook. And I will also overlook the carrier’s decision to use affiliates to hasten its network build, a decision that would later come back to haunt it as it was forced to them acquire those affiliates for billions of dollars.
What is more difficult to forgive were more recent issues, like its Clear Pay fiasco that showed the carrier’s industry-leading growth during the early parts of the last decade was built on welcoming millions of customers that had no intention of ever paying their bills. Not a sounds business model, and a decision that when “corrected” led to skyrocketing customer churn and revealing insight into Sprint Nextel’s true growth rate.
Then there was that whole buying Nextel for $35 billion, that no one saw coming and for good reason. Now, some might argue that at the time Nextel was indeed worth that much money and to be able to get its hands on those lucrative Nextel customers was worth the risk. Perhaps.
But, it now appears that Sprint could not have handled that deal and the integration any worse than it has, having to shortly after the deal closed to write-off virtually the entire value of the deal. Sure, Sprint Nextel did end up with some nice 2.5 GHz assets, but those were eventually turned over to Clearwire, which has since run out of money to do anything with that spectrum portfolio.
The deal left Sprint Nextel with double the expenses in having to run two networks, one of which it didn’t really seem like it wanted to run and the other it could do little to upgrade since it was forced to run … say it with me … two networks.
And speaking of Clearwire, Sprint Nextel rode that company’s coattails in ushering in the era of “4G” marketing hype, flooding the advertising airwaves with claims of having the nation’s first 4G network and telling anyone who would listen that its time-to-market advantage would put the carrier at the forefront of the 4G space. Well, two years later and I think we all know how well that turned out. Sure, Sprint Nextel is still offering that 4G service, but thanks to Clearwire’s financial issues, network coverage has ceased to expand beyond its current footprint and the technology being used has ceased to be relevant. That’s a fine way to thank all of those early adopters.
And, from my limited time of actually using Clearwire’s WiMAX network using that same spectrum, I have to agree that it’s the most uneven connectivity experience imaginable. I have seen a “4G” device literally lose its “4G” connectivity by just turning my body. How is that even possible?
Then there is Sprint Nextel’s current network upgrade plans that its current network desperately needs. (Apparently years of neglecting your network is not a good thing.)
This Network Vision initiative will cost the carrier billions of dollars that it hopes to score back over the next decade or so due to increased efficiencies. As part of those plans, Sprint Nextel is going to start rolling out LTE services using the bare minimum amount of spectrum for a nationwide operator, with a limited availability of adding new spectrum to the offering for several more years. Oh, and the carrier admits that it currently has just enough spectrum to handle customer demand for the next two years or so, or add on one more year if you want to count the spectrum LightSquared is currently trying to wrestle from the GPS community.
That all brings up to Sprint Nextel’s most recent news as it finally gets the iPhone, a device that its inability to offer has drained it of consumer cache and forced the carrier to put its eggs in the quickly commoditized Android basket. But to get that device it has had to fork over a boatload of money in what appear to be guaranteed subsidizes to Apple for the “privilege” to carry the iPhone. This at a time when it’s also in need of billions of dollars in order to update a network that has been lying in disrepair for years because the company did not have the money to spruce it up.
Some in the investor community are taking a long-term look at the iPhone and saying that the move will pay off long term for the carrier and investors as Sprint Nextel’s stock has plummeted in recent months. Other, though, are more concerned that looking too long term for Sprint Nextel is a risk as the carrier has not shown the ability to make sound short-term or long-term decisions.
I would note that while all the pieces do appear to be in place for Sprint Nextel to come out of its current funk in a solid position, we are talking about three to four years from now, at which point who knows what the competitive environment will look like and what sort of bogies could be lobbed into that path. No one saw the iPhone coming.
Like I said, I really want to see Sprint Nextel prove its doubters wrong by somehow continuing to keep all of these balls in the air while riding a unicycle perched on top of a beach ball. But, history has made this a difficult proposition. I guess all I can say is: Come on Sprint Nextel, give us something to root for.
OK, enough of that.
Thanks for checking out this week’s Worst of the Week column. And now for some extras:
— I count myself an unfortunate soul for not “living” through the early days of the cellular industry. Sure, I was alive in the mid-80s when all of those industry-shaping events were going, but I held neither the stature nor the financial wherewithal to participate in the burgeoning space.
(Truthfully, I spent most of that time putting together Lego Star Wars kits and then shooting them to pieces with my BB gun.)
Time well spent.
However, this past week I was able to take a step back in time and relive what I can only imagine were the halcyon days of the mobile space thanks to the delivery of a satellite phone from Inmarsat. Satellite phones!?! Yup, they are still around, and thankfully many are still the size of a small dog.
Having had my share of the latest and greatest smartphones that appear to have been cut from the same cloth, getting my hands on a device that was shaped like a well-crafted brick in both size and weight was a welcome relief. Sure, the phone would not fit into my pocket or carry-on luggage, but when you have a satellite phone, the last thing you want to do is hide it.
My solution? Rig up a chain around my neck so that sat phone could swing proud and head to the local mall. Thanks Flava!
I am also guessing that since the satellite phone was unable to get a signal anywhere near a building, my trip through the mall was also like the early days of cellular when phones were also challenged to get a signal indoors. Of course, this inability of the satellite phone to work did not stop me from unfurling the antenna and making like I was an important businessman/time traveler looking to close that last deal before escaping the scene in my DeLorean.
I am not saying that all phones need to include satellite capabilities, but what harm would there be in offering some phones that have a bit more size and scale instead of everyone pumping out cookie cutter designs that are only differentiated by the version of dessert their operating system runs?
I know I have already staked my claim that the Casio Commando is the best smartphone ever – and I am sticking by that, but I am now placing this Inmarsat device as the best non-smartphone ever.
–Finally! The folks that put on the annual tech-orgy known as the Consumer Electronics Show have found a hook that makes me finally want to attend their event. That’s right, they have named Eliza Dushku “Entertainment Matters Ambassador” for the 2012 event.
Now, taking aside my attempts at trying to figure out what the hell an “Entertainment Matters” is/are/was and why he/she/it needs an ambassador, all I could say was “wow!”
Even better is the quote provided by CES and attributed to Ms. Dushku: “I’m honored to be the first Ambassador to the Entertainment Matters program at CES and special contributor to Spike TV’s ‘CES All Access Live’ coverage programming. I’m incredibly fortunate to have great, tech savvy fans who constantly push me to stay ahead of the curve in consumer technology, which I’m very passionate about. I love going to CES, and I’m excited to now have a real platform to encourage more of my film and television industry colleagues to experience CES.”
(My guess is that her true fans only read “curve” and “passionate.”)
You can’t make this stuff up! Or can you … ?
I welcome your comments. Please send me an e-mail at: dmeyer@rcrwireless.com.
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