Sprint’s new CEO, Marcelo Claure says price cuts, network fixes, and job cuts are coming
Mr. Claure presented three points in the company-wide meeting: reduce prices, improve the network, and “optimize Sprint’s cost structure.” The company is “going to change [its] plans to make sure they are simple and attractive and make sure every customer in America thinks twice about signing up to a competitor.”
To justify what are said to be “very disruptive” rate plan changes, Mr. Claure pointed out that “when you have a great network, you don’t have to compete on price. When your network is behind, unfortunately you have to compete on value and price.”
That means that whatever profit margin exists on Sprint’s mobile service, it’s going to get a lot thinner, and that is where Mr. Claure’s third point comes into play, reducing operational costs. That is not-so-secret code for layoffs.
The new executive also briefly addressed Sprint’s now-defunct plans to buyout T-Mobile, saying that SoftBank (who owns 80% of Sprint) CEO Masayoshi Son “spent days and nights talking about the merger I’m not supposed to talk about.” In the end however, it was bad timing because Son was also preparing for former Sprint CEO Dan Hesse’s departure (read as: a polite dismissal).
No details were given about what the new rate plans would be, but Mr. Claure stated that as soon as they were available, sales teams and dealers would have the tools to close the sale, something that has not been the case in the past.
For network improvements, Mr. Claure admitted that the network “rip-and-replace” has taken too long, and the general perception of America’s third largest carrier is mostly negative. The new “Framily” rates have not been helping either.
The third item, job cuts, are going to basically be two columns, “must haves,” and “nice to haves.” Everything that falls in the latter will be scrutinized. Whatever cuts are made, they are going to hurt. Sprint has about 36,000 employees, about as many as T-Mobile which is seen as a lean operator.
Marcelo Claure built Brightstar from scratch and it is now a multi-billion dollar wholesale enterprise with operations around the world. SoftBank now owns 57% of Brightstar in a $1.25 billion investment, and those holdings are expected to increase to about 70% over the next five years.
Mr. Claure believes that consolidation (carrier mergers) are the way of the future, but is committed to the task at hand which is, returning Sprint to growth. His predecessor presided over 7 continuous years of customer losses. That means, price cuts now, job cuts soon, and network build out after. Sprint holds more spectrum licenses than any of the competition, albeit in higher frequency bands. When it comes to spectrum, more is better, and it is long overdue that Sprint use what it has.
sources: Light Reading and Bloomberg
14. engineer-1701d (Posts: 2193; Member since: 13 Mar 2014)
this might make me resign i have been out of contract for 1 month sprint and tmobile are the same in my area i did the 7 day test network. i just hate paying 90 for speeds of 1.5 mb on lte and .25mb for 3g if the cost cuts are really good that could bring people to sprint if they admit on tv commercials that there network is not the best but will be and they will prove it by dropping cost alot, and building up its high band fast.
13. fanesxx (Posts: 74; Member since: 19 May 2011)
hopefully he fires the ones "not"doing their job
3. promise7 (Posts: 555; Member since: 03 Jul 2013)
I'll have to see their new rates to believe it, but they desperately have to do something ground breaking to shake things up. At this rate it's not if, but when, T-Mobile takes over the #3 spot.
4. QWIKSTRIKE (Posts: 940; Member since: 09 Mar 2010)
About time...... That iPhone deal killed us,... That money would have been better spent improving the network.
28. wumberpeb (Posts: 452; Member since: 14 Mar 2011)
The deal hurt, monetarily, but it was 100% necessary. Think anyone wants to go to a company that doesn't carry the iPhone? I personally hate the phone but it's roughly half of what they sell in most of the stores I oversee. Can't imagine business without it now. To say that with the money they invested in the iPhone deal would have helped their network and been better in the long run is foolish; looking back, that extra money would still not have turned their network around in time
30. engineer-1701d (Posts: 2193; Member since: 13 Mar 2014)
I feel the same I hate iPhone but thought it needed to help but did not know about the mass amount of money it cost, then a year later tmobile gets out with out having to pay what we paid f you Dan and Apple
31. QWIKSTRIKE (Posts: 940; Member since: 09 Mar 2010)
IT WAS A FOOLISH DEAL, HE COULD HAVE MADE A BETTER DEAL FOR IT, AND HAD HE WAITED 2 MONTHS APPLE WOULD HAVE GIVEN HIM ANY THING THAT HE DEMANDED. When he made the deal iPhone sales were in decline!
He could have made a way better deal, Dan was just misinformed and foolish. T-Mobile waited and look at their position. Every one that has any business sense knows it was a foolish gamble, that didn't save them.
Not having the network completed sooner in lieu of the iPhone deal would have fared better!
5. Planterz (Posts: 1498; Member since: 30 Apr 2012)
Sprint sucks. Coverage sucks, speeds sucks. The only thing that doesn't suck is price and unlimited data with their sucky coverage and sucky speeds. If you work for a large company, chances are they have a deal with Sprint that can save you even more on their crappy service.
If Sprint wants to stay relevant, they need to improve their coverage and speed, decrease their prices, or both. And/or maybe copy what T-Mobile is doing regarding contracts, because TM is about to overtake Sprint. Unlimited data on the country's crappiest network is like being offered a lifetime supply of top ramen and AOL email.
8. Planterz (Posts: 1498; Member since: 30 Apr 2012)
You've got bad grammar.
You have gotten mail. You have mail. You have received mail. You have new mail.
Those are acceptable.
"You've got mail" is just bad English. But AOL also used Snoop Dog (Lion?) as a spokesperson, so what the hell do they know?
12. troutsy (Posts: 287; Member since: 17 Feb 2012)
Whew! I was going to have a panic attack if some internet troll didn't ruin that perfectly fine joke.
7. Slammer (Posts: 1398; Member since: 03 Jun 2010)
How can you say Sprint coverage is horrible? I test drove tmobile's service due to my contract being up with Sprint. While Tmobile had good service in the city, I lost it almost completely 11 miles outside the city limits. At one point it was 8 miles. As a field service representive that travels a lot out of my city limits, Sprint fared far better with network access. When in the rare event that I do lack Sprint coverage, I pick up and roam on Verizon wireless.
11. PapaSmurf (Posts: 9723; Member since: 14 May 2012)
Nowhere did he mention T-Mobile's network was better than Sprint. You need to learn how to read Mr. John B.
16. engineer-1701d (Posts: 2193; Member since: 13 Mar 2014)
he is talking about the post above about t mobile passing them because of service, also i tested tmobile and in the city 6 miles north of me while getting a tattoo i had 0 bars and 0 data on tmobile, was truly amazed that they have no service in that city for tmobile.
26. Slammer (Posts: 1398; Member since: 03 Jun 2010)
I don't need to learn to read. Past posts by Planterz have led cheerleading exhibitions for Tmobile's network while dissing Sprint on what is actually an important part of communication service; Coverage. Sprint has more widely nationalized covered areas than tmobile and if you include various roaming partners such as VZW, Sprint's coverage is huge. If you guys don't like Sprint, that's fine. But, don't ignore the facts.
I would expect more from people on these sites that claim they are network geniuses.
20. Doakie (Posts: 1591; Member since: 06 May 2009)
Funny I've not seen what you have. Of course I live in Seattle the home of T-Mobile corporate. But where I've seen 2G T-Mobile coverage I've been around 200 Kbps which is the speeds I've had on Sprints 3G... If you live in an area with that bad of coverage you should just cough up the dough and get Verizon...
25. Slammer (Posts: 1398; Member since: 03 Jun 2010)
I don't live in an area with bad coverage. I've had Sprint for 8 years and it has always served me well. I don't travel outside of the coverage zone enough to warrant VZW or AT&T. But, my contract was up and thought I'd try something different. Tmobile didn't cut it. So I'm staying put.
22. lsutigers (Posts: 803; Member since: 08 Mar 2009)
Agreed, Sprint absolutely destroys TMO in terms of coverage. Speed is where TMO wins.
24. DnB925Art (Posts: 563; Member since: 23 May 2013)
So true, I was in Portola Valley here in the Bay Area (a town right between San Francisco and San Jose a few miles west of Palo Alto/Stanford University, and had ZERO coverage on T-Mobile on my personal phone. On my company-paid phone on Sprint, I had both voice and data coverage.
9. tokuzumi (Posts: 515; Member since: 27 Aug 2009)
We shall see what happens. Hesse talked a good game, but fell short on following through, especially with regards to network improvements. I hope their new chief will help sprint become a better carrier.
10. ProblemSolver15 (Posts: 217; Member since: 14 Jun 2010)
Yo, what happened to Hesse? I could just as easily Google this answer, but my smartphone has made me lazy.
17. engineer-1701d (Posts: 2193; Member since: 13 Mar 2014)
he took his 20 million bonus for the year and was fired for being a jobs man steal the peoples money and give them a shiny turd.
18. skymitch89 (Posts: 1188; Member since: 05 Nov 2010)
Let's hope that he gets something done with the company. The past 2 times I've upgraded my phone, I stayed with Sprint mostly because of the promise of better coverage/data speeds. With the last upgrade I did (going from the Epic Touch to the Note 3) my monthly bill increased almost $40 (because of equipment installment plan), I get spotty LTE coverage (not to mention that there's times when I do get LTE & my speeds are just as bad if not worse than when on 3G), the inability to hold a call more than 30sec when on 3G, & even with the ability to do wifi calling I can only connect to certain wifi networks & have it work.
19. Doakie (Posts: 1591; Member since: 06 May 2009)
Yeah. I had the same issue. I went from an EVO 4G WiMAX to a HTC One M7. My download speeds went from 7-10 Mbps on WiMAX to 1.5-3 Mbps on LTE. At this same time 3G here in Seattle dropped down to around 50-200 Kbps. LTE was only a few towers here and there at that time. So essentially my phone was useless with a 50-200 Kbps connection. I couldn't even check Gmail some of the time. I had to make a hotspot out of my T-Mobile work phone to check my personal email... Totally unacceptable. We paid $1300 in ETF to leave Sprint and went to AT&T. I couldn't justify paying Sprint for service I couldn't get, I felt like I was being robbed. I'd rather eat some losses on ETF and have a workable phone. After selling our phones we spent about $600 to leave. AT&T is definitely better than Sprint. Pretty happy with the coverage and speed I have now and now that AT&T dropped their prices we're paying $160 for 4 lines which is less than what we were paying for Sprint which was $260 for 5 lines.
23. soferj (Posts: 1; Member since: 15 Aug 2014)
I chose sprint 2 and a half years ago because I was getting unlimited data and saving $30 a month with 2 lines. What a mistake! If you feel the savings are worth daily drop calls, very slow and random data connections, go for it. The unlimited data was worthless because I Icouldnt use it or so slow to be unusable. They have improved the network slightly, but still nowhere near others. I switched to an Att network and learned that I can actually use my data when not on a wifi. I am in the LA area.
27. jm5150jm (Posts: 1; Member since: 15 Aug 2014)
this is getting fuking ridiculous.. I work for Sprint.. We have MASSIVE layoffs TWICE A FRIGGEN YEAR FOR THE PAST 5 YEARS. do you know how god damn frustrating that is? to work at a place where youre scared to lose your job twice a year EVERY YEAR?????!!!!!! theres nobody left to lay off... they trim the fat constantly. My office used to house about 300 employees... its down to 35 tops. enough is enough. dont ever work for sprint if you arent ok with someone telling you twice a year.. "um yeah, you might lose your job in the next month but we're not sure, we'll let you know".
29. wumberpeb (Posts: 452; Member since: 14 Mar 2011)
Are you corporate or a preferred retailer? I'm guessing the former