2007 Top Ten: Sprint Shockas
This past year was arguably the hardest yet for struggling wireless operator Sprint Corp. (NYSE: S). From WiMax woes to the departure of CEO Gary Forsee, we run down the hard knocks this year for the Reston, Va.-based carrier.
10. Failure to cash in on spectrum reserves While the rest of the U.S. wireless scene goes crazy over the 700MHz, one carrier already has more wireless broadband capacity than can be bought in the forthcoming Federal Communications Commission (FCC) auctions.
When Sprint and Nextel merged in 2005 the pair combined their 2.5GHz spectrum reserves. Sprint Nextel has more of this wireless broadband spectrum than any other operator in the U.S. -- 90 MHz of 2.5GHz spectrum, covering 80 markets across the country. (See WiMax USA: Spectrum Crunch Ahead.)
As Sprint CTO and 4G Chief Barry West told Unstrung earlier this year that it had the "best spectrum position of any major carrier in the U.S.," but this "pole position" has not been reflected in Sprint's share price through 2007. (See Sprint's West: WiMax on Track.) 9. Share price declines Sprint closed trading on December 29, 2006 with its shares at $18.89. A year later the operator's shares are at $13.19, a decline of 31 percent over 12 months. The 52-week high for the stock has been $23.42, the low $12.97.
8. A quarterly loss The operator didn't have a good quarter all year, but the first three months of 2007 were some of the bleakest. The carrier reported a loss of $211 million, or 7 cents per share, for the quarter that ended March 31. In the same quarter in 2006, it made a profit of $419 million. CEO Gary Forsee blamed the loss on spending to improve call quality and coverage on the carrier's CDMA and iDEN networks. (See Sprint's Cold Call Quarter.) 7. So long, SpectrumCo In August, Sprint dropped out of a wireless spectrum bidding consortium that's headed up by four major cable MSOs: Comcast Corp. (Nasdaq: CMCSA, CMCSK), Cox Communications Inc. , Bright House Networks , and Time Warner Cable Inc. (NYSE: TWC). The operator said it was withdrawing from the spectrum consortium so that it could focus on the "Pivot" cellular service joint venture with the cable companies. (See Sprint to Exit SpectrumCo Venture .)
6. Pivot cut off In November, Sprint once again switched focus and pulled out of the Pivot cellular venture that it had been working with Comcast and others. "It's an integrated product... with retail it's made it difficult to deliver in a timely and simple process," noted acting CEO Paul Saleh at the time. (See Sprint Halts 'Pivot' Expansion.)
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