In a black-and-white commercial filmed last year, Daniel R. Hesse, the CEO of Sprint Nextel Corp. strolled down the middle of a carless New York City street.
Relaxed and friendly, he spoke directly into the camera about a “wireless revolution.”
The revolution - Sprint was introducing a flat-rate system - may have been a good idea, but it hasn’t stopped the bleeding at the nation’s third largest wireless carrier.
Daniel R. Hesse
In the second quarter of this year, Sprint lost $384 million, as well 991,000 contract customers.
The loss in contract or “postpaid” customers represented a slight improvement from the first quarter when 1.3 million postpaid subscribers left Sprint.
Nonetheless, the carrier lags far behind Verizon, which has 87 million customers and AT&T, which has 80 million.
Sprint did add 777,000 non-contract, prepaid customers during the last quarter. It has also recently purchased Virgin Mobile USA Inc., a move that will add to its prepaid numbers.
But prepaid users are not considered as dependable as postpaid customers, as they are not tied into contracts.
“As successful as prepaid is, it doesn’t drive enough incremental profitability to make up for the loss of postpaid subscribers,” Hesse told The New York Times.
In an exclusive arrangement with Palm Inc., Sprint began offering the Palm Pre smartphone to contract customers in June.
The phone, which has had positive reviews, features both a touch screen and a keypad and is seen as a rival to Apple’s iPhone.
Sprint did not release revenue figures for the Pre, though they were said to be strong when the phone was introduced.
Nonetheless, Hesse told the Times that the phone was not in the league of the iPhone in terms of sales. In addition, Verizon will be getting the Palm Pre early next year, ending Sprint’s advantage.
The upside at Sprint, besides the addition of prepaid customers, has been an improvement in customer service, Hesse told the Times.
In the long haul, he hopes word on this gets out, offsetting the perception that Sprint is not the service equal of its competitors.
Hesse, 55, became CEO of Sprint Nextel in Dec. 2007. Before that, he headed Embarq Corp., a local phone company that had been spun off from Sprint in May of 2006.
Earlier, he was chairman and CEO of Terabeam Corp. a wireless provider. Previous to that position, he had worked at AT&T for 23 years.
The television ads featuring Hesse as Sprint’s corporate spokesman debuted in March 2008 with the “wireless revolution” ad.
Another spot shows him walking though New York’s Grand Central Station, classical music in the background. He touts the number of Sprint business customers and hypes the first “4G network.”
In yet another, Hesse, whose office is in Kansas, is seen taking a cab over the Brooklyn Bridge. He’s using his laptop, thanks to Sprint’s wireless network. “I’m working from the road today,” he says in closing.
In March of this year, Sprint announced it was ending the ad campaign.
Hesse commented to The Wall Street Journal that the ads were effective but viewers could only take so much of any corporate spokesman.
“I’ll wear out - they’ll get tired of seeing that guy,” he said.
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2 Comments
#1. Bill 08.01.2009
Sprint should just consolidate all their brands under a new name and go completely pre-paid with smartphones as an option.
#2. Ex-employee 08.02.2009
of course i have an ax to grind.
but sprint couldn’t manage a fart after a baked bean dinner.
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