Sprint sued over Nextel buy

She's right about what happened, but I'm not sure if the reason for it was the actual merger attempt. Does anyone think that Sprint would've been better off without Nextel? In my opinion, Sprint was showing signs of going downhill anyway, but I think without the Nextel acquisition, Sprint wouldn't have dug themselves so deep in the hole. Nextel was a bomb waiting to explode and they knew it. That's why they sold themselves. If Sprint hadn't bought them, I think they would've faced the decision of going out of business. With no standard spectrum, building a CDMA or GSM network from scratch was not an option for them.

 

what a giant mess. it's amazing, but not surprising, that the complications of this merger are still apparent even today... a few years later.

nextel is a giant albatross to sprint. they need to leave that network for dead and focus on the CDMA side of things.

 

Not me! I am a big advocate for the merger. Sure they paid too much for Nextel but without the merger Sprint's CDMA network wouldn't be nearly what it is today. Nextel had so many great tower locations that easily accommodated CDMA without the need for new zoning/leasing and fighting NIMBY's. As a result us CDMA customers get much improved and expanded coverage that Sprint had NO plans on doing at the time of the merger, nor could they have ever done solo. But many people even today still don't realize this. Because people love to focus on the negative stuff.

The merger also led to Sprint's buyout of 5 or 6 key affiliates which gave customers in those areas access to Sprint's corporate offerings, free roaming, better rate plans, etc.

 

Of course Sprint would have been way better off without Nextel! Before this merger took place Sprint had an improving network and customer adds. They also had more free cash years ago than they do today. As well as Sprint's stock is junk now and they have been laying off and trimming costs. Sprint should have focused on it's CDMA network, CS issues, and buying out ALL of their affliates. To be united under one technology and one brand.

That's the problem. Remember back when Sprint was so focused and organized? Look at them today though. Having their hands full with a billion companies involved in WiMax, still fighting with iPCS, and this mess that still is going on with Nextel. I think we all know that WiMax is gonna be a big failure for them and the aging and poor iDen network is pulling them down.

Sprint's poor and deserved rep for CS has dragged them down and having a bunch of brand names with mixed and incompatible technology hasn't helped them either. You have Sprint CDMA, a pain in the ___ CDMA affilate iPCS, Nextel iDen, Boost prepaid which uses iDen well except for those few customers that still use CDMA "Boost Brand". Then you have "Clear" coming out which is WiMax data and its a partnership with a lot of companies. That so far has two brands "Clear" and Xohm which as of yet can't roam on each other.

Talk about an identity crisis and confusing! With Sprint's poor CS and confusing technologies and brands, it's killing them. Sprint is doomed to a failure they have stretched themselves out too far and lost focus. The company is too far gone, losing too many customers, the stock is crap now, and too scatter brained to ever recover.

In five years from now we'll have Verizon, AT&T, T-Mobile, and to a certain extent a Metro PCS/Cricket merger that will be the 4th largest carrier. Sprint has a lot of customers still and spectrum but I can bet it will be sectioned off to the other 3 major carriers and possiblely to the new Metro PCS/Cricket company. The Sprint name will be dead and the company's name will go down as the biggest telecom failure in american history.

 

Larry, it's hard not to focus on the negatives when there are so many. Make two lists, one for the positives and another list for the negatives of this merger and you'll see what everyone is talking about.

 

Buying the towers was a great idea. The high price was the big mistake.

 

Agreed. But at the time that was the going market price. Nobody knew it was that overinflated of a price and that the economy would take a major collapse.

When you see 8 Nextel (formerly iDEN only) towers within 5 miles of your house get CDMA just 1-2 years after the merger it's hard not to be in favor of the merger. That's just one example of the MANY benefits that came from this.

My point was that nobody ever seems to realize the coverage benefits of the merger. The CDMA improvements were very extensive but nobody will ever talk about it or acknowledge it except me. Maybe Sprint should have done a better job at marketing/advetising that aspect of it.

 

Sprint could have used the money they wasted on Nextel to co-locate on other locations and build out more themselves. They also could have focused on improving their affliate situation and poor customer service. Sprint already had problems and instead of fixing them they decided to buy another company that had issues themselves. Two companies coming together as one doesn't cancel out each others problems it only doubles them.

 

Yes and no. Sure they could have built a few more sites on their own but they had no plans to really do a large scale improvement expansion like that. Even if they had they would have had to fight NIMBY's, settle for less desirable locations (Nextel had old school style towers with great height and range for CDMA drop-ins) and would have had to go through a lot more red tape to get them built. It just wasn't going to happen as well and as fast as it did with the merger. I guarantee that without the merger Sprint wouldn't have put up those 8 sites within 5 miles of my house. They didn't really need them all that bad so they wouldn't have invested the money on them if they had to build them from scratch and sign new leasing deals.

It's easy to be a Monday morning quarterback and say "yeah but they could have done this instead". But what good does that do now?

 

Let's not forget that because Sprint burned so much money on the Nextel merger, they have no money left for any further build out. At a time when every other carrier is building out their networks even further, sprint is at a 100% standstill. Since the initial synergy sites, in my home town Verizon, AT&T, T-Mobile, and MetroPCS have all installed NEW sites to fill in coverage and capacity gaps, while sprint did nothing.

Yes, Sprint did move their CDMA site across the street and up a bit higher, but has not installed a NEW site in years and years.

 

That is not true. In fact Sprint just activated two brand new CDMA only sites in Redondo Beach and Torrance, CA which is a suburb of Los Angeles near me. Sure they have cut back due to financial problems but they are certainly not 100% inactive. Maybe there's nothing happening in your area but it's a big country out there and Sprint is still making all kinds of improvements. Did you see these press releases in the past two months about enhanced coverage?

Sprint | 2009 News Releases

Here in So. Cal there's really not a whole lot left to do thanks to the Nextel synergy sites of the past 4 years. Just a few fill in sites here and there but this area doesn't really need any additional improvements.

 

Ok, maybe there is some minor improvements being made in some places. But, as a whole, there is nothing going on. I have not seen a new site go up in the NYC market in probably 2 years. While all the others are throwing up sites within neighborhoods to provide better indoor coverage, sprint sits still. It's a shame.

 

Great... it seems like every few months Sprint gets sued for something or other... and when one gets settled or judged, another one gets filed.

 

Well I really can't challenge your statement officially since I've never received any data or internal maps for NYC. But as my educated personal opinion I believe that would be incorrect. NYC is a very large market and if you go back two years that was right in the heart of the synergy expansion and I remember seeing a lot of new site markers on the website maps (back when they use to actually keep them up). It would be impossible for anyone to specifically know what's been happening there the past 2 years unless you worked for Sprint and had their official data. Now during the past 1 year I would agree that things have slowed down but that is partially because they no longer need as many new sites.

Now as for the others like Metro they are building a new network from scratch so of course they would be very active right now.

Here in So. Cal none of the other carriers (except Metro) are building like they used to. Verizon isn't doing anything and neither is AT&T really. T-Mobile is still a bit active but not nearly as much as they were a year ago at this time. It's not just Sprint who has slowed down their activity.

The one bright spot is that Sprint's affiliates (iPCS and Shentel) are VERY active right now expanding their networks (Sprint service) despite the economy. I think that's even more important because those areas actually needed a lot of work and now they're finally getting them.

 

My area is ran by iPCS and they haven't put up any new cell site locations here in a while. My area is also listed as a "key" market for iPCS. Granted Sprint's coverage in my area is pretty good, it honestly doesn't need a lot of improvements. However I can think of a few weak locations with Sprint that still have not been fixed.

I have to agree though Sprint is currently the slowest of the carriers to fix weak and dead spots. Sprint really has scaled back on coverage improvements. Sprint's budget for build outs has been cut way back and they are struggling on the WiMax built out even though they are only a part of that. Sprint won't be able to survive much longer with it's poor rep, losing millions of customers each quarter, starting to pile up a debt, and all these legal fees from all these lawsuits.

I won't be sad when Sprint fails though. They deserved the worst marks for customer service by outsourcing so much, they used an affliate situation to cut short term debt which later turned around to bite them in the butt, and the company was ran horrible and mismanaged.

 

I really hope this gets tossed out of court. This shareholder was lazy and got burned for it. Any time you invest in something it is a gamble. You need to do your homework not just sit their and believe what the company is telling you. This shareholder could of picked up any major wireless or financial publication at the time and seen how uncertain most were about the merger. And a simple talk with the corporate heads about those articles and their saying should have given any one enough information to continue or sell their shares.

 

I also don't think the head brass at Sprint falsely misled stockholders. There were plenty of resources full on trouble areas and concerns regarding the merger. You can't listen to the CEO and no other resources and believe you're getting the full picture.

I've got to agree with TNDan on most parts. I don't know if the merger itself was a bad deal, but there's no doubt that Sprint has handled it horribly. They didn't have good enough Customer Service to retain customers, they have failed at integrating technologies and keeping both Sprint and Nextel viable companies, and I'm still concerned that they've still got a ways to fall before they hit bottom. Sure, it's easier to make a decision from hindsight, but I can't think of any course of action that could have been worse for Sprint. With no merger at all they'd be in a lot better shape because they'd probably be posting net customer adds and have a better credit rating, If they bought alltel or USCC they could have integrated the CDMA network, ditched the Sprint brand, and gained a larger network to save a ton in roaming costs they're paying rivals in addition to the customer additions. It's nice that Sprint could co-locate with Nextel, but I would think co-locating on all alltel or USCC tower sites would have been better in the big picture, though not necessarily in NY, LA, and several other of the largest markets to which Larry is referring.