Sprint Nextel CEO Optimistic About Company’s Future

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6:00 am on September 22, 2008 | Category: Business, Telecom Services, Wireless

Struggling U.S. cell phone giant, Sprint Nextel Corp., hopes to turn around its fortunes by placing greater emphasis on customer service, and focusing on new technologies such as WiMAX, according to the company’s Chief Executive Officer, Dan Hesse.

Hesse expressed optimism about Sprint’s future during a question and answer session at the recent Goldman Sachs Communacopia conference in New York City, noting that customer satisfaction levels are already beginning to increase.

Hoping to win back lost ground, Sprint recently unveiled seven new handsets, as well as a convenient new “One Click” application that makes it easier for users to set up and learn to use their mobile phones.

Sprint is also planning to release a new service called Ready Now, which will soon be available in 1,200 Sprint retail outlets, and makes it possible for customer service reps to help users program and customize their new smartphones for up to 25 features.

One of the main barriers to consumer smartphone adoption, according to Hesse, is that many customers can’t easily learn to program and use them. “What we want to do is make that really simple,” Hesse said, referring to the Ready Now service. “That is unique – it’s unique in wireless but it’s unique in all of retail.”

When asked about the effects of a troubled global economy, Hesse said that this was not currently a problem for Sprint, noting that the company’s $99/month Simply Everything unlimited wireless service is actually growing in popularity. He also suggested that the lower “churn rates” (the percentage of customers switching carriers each quarter) that generally come with a troubled economy could be positive for the company as it gets back on its feet.

“If anything, going forward it is possible that there could be a benefit in that there will be fewer gross adds available out there in the marketplace or less churn,” he said. “Customers will keep their existing phone for a longer period of time, because even though there is an opportunity to leave, it still may be 50 bucks, or 99 bucks – or what have you – to leave. And then I’ve got to sign up for another two-year agreement that has some early termination fees, and I don’t know what my economic situation is. So I will stay put for a period of time.”

Hesse also talked Sprint’s plans to unite its WiMAX business with that of Clearwire Corp., echoing recent comments by Clearwire CFO, John Butler, that the partnership is proceeding according to schedule. “We still have every expectation that the deal will close in the fourth quarter,” he said.