Light Reading

Sprint's New Boss Plans Cost Cuts

Sarah Thomas
8/12/2014
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Just one day into the job, Sprint's new boss Marcelo Claure is house hunting near the company's Overland Park headquarters and preparing employees for cost cuts and a revived aggressive competitive strategy. (See Hesse Out, Claure In: Sprint Is Son's House Now!)

The former Brightstar Corp. CEO will hold a company-wide "town hall" meeting on Thursday to outline his vision for the struggling wireless company. With an acquisition of T-Mobile US Inc. off the table, Sprint Corp. (NYSE: S) has to find a way to compete in the market alone, especially against T-Mobile itself, whose boisterous CEO is already waging verbal warfare against Sprint. (See DT Wants Spectrum Favors; Legere Wants Sprint's Slot, T-Mob's Legere Unleashed: 'Total Chaos at Sprint' and Sprint Drops Bid for T-Mobile – Reports .)


Vote for what you think Claure needs to do with Sprint in our new poll here on Light Reading.


Claure didn't share specifics on Sprint's future, but he did say that its new strategy will have to include competing aggressively in the marketplace, building on comments outgoing CEO Dan Hesse made around experimenting with dropping prices on the carrier's most recent earnings call. (See A Short History of Hesse and Sprint, T-Mobile: The Price War's On.)

The plan could also include more job cuts to become more cost efficient. In the memo obtained by Bloomberg, Claure writes, "In the short term, our success will come from our focus on becoming extremely cost efficient and competing aggressively in the marketplace. The management team has been working closely with the board to outline the future strategy of the company."

Claure also alluded to the company's scrapped merger plans with T-Mobile, noting "You have probably seen the many media reports speculating about Sprint's future. As I have already said, consolidating makes sense in the long term but, for now, we will focus on growing and repositioning Sprint."

— Sarah Reedy, Senior Editor, Light Reading

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mendyk
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mendyk,
User Rank: Light Sabre
8/13/2014 | 4:01:28 PM
Re: Buyer's market
I imagine he gets paid enough to afford several McMansions and a decent-sized private jet to commute from Kansas to Cali.
DanJones
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DanJones,
User Rank: Blogger
8/13/2014 | 3:47:39 PM
Re: Buyer's market
No, there's a rumor that Son would like Sprint HQ to move to California, they've said they'll stay in KC so far.
mendyk
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mendyk,
User Rank: Light Sabre
8/13/2014 | 12:09:48 PM
Buyer's market
It will be easier for Mr. Claure to find a house when all those liberated employees start putting up "for Sale" signs. But didn't Sprint also say it was moving out of Overlord Park?
DanJones
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DanJones,
User Rank: Blogger
8/12/2014 | 4:57:44 PM
Re: Where's the mojo?
Well they *did* say his first priority would be to focus on the network when the changeover was announced....
sam masud
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sam masud,
User Rank: Light Sabre
8/12/2014 | 3:38:20 PM
Where's the mojo?
Sprint needs to find the mojo it had back when it became the first to move to an all-fiber network and boasted the voice quality was so good that you could hear a pin drop.  Having heads roll is just a quick way for a new suit to cut costs. But where's the vision?
Mitch Wagner
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Mitch Wagner,
User Rank: Lightning
8/12/2014 | 1:00:52 PM
Re: Claure's in charge
Now that I think of it, more naps would be a good strategy. 
Mitch Wagner
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Mitch Wagner,
User Rank: Lightning
8/12/2014 | 12:19:14 PM
Re: Claure's in charge
Not impressed by this leaked vision. Layoffs have been SOP for companies at a crisis point for decades -- it's like a medieval doctor bleeding the patient to get rid of evil humors. 

And as for "competing aggressively in the marketplace" -- what did we expect? He'd be in favor of long naps?

 
billho888
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billho888,
User Rank: Light Beer
8/12/2014 | 12:01:18 PM
Re: Claure's in charge
My 2 cents - he has to expedite 2.5. Hitting 100M POPs by EOY 2014 isn't that great though some mkts have 2X carrier agg. T-Mo is putting up and promoting its Wideband LTE as a speed differentiator. Though 2.5 doesn't have propagation as PCS, will they throw more capital down to bring about real speed across the native footprint?  Tough call but the Chairman is all about speed and openly touted that he wants to bring speed to the US. 

More pressing than M&A is marketing and acquiring customers in late Q3 and Q4. 
billho888
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billho888,
User Rank: Light Beer
8/12/2014 | 11:45:18 AM
Re: Claure's in charge
It'll be interesting to see how aggressive he'll lead the company in the 2.5 ntwk and customer acquisition. 
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