Acquiring T-Mobile would have bought Sprint a lot more customers and eliminated a pesky competitor. But it would have done almost nothing to improve Sprint's biggest competitive disadvantage compared to AT&T and Verizon, the lack of rural coverage.
Hesse was an affable frontman for Sprint but the company declined under his watch. His replacement, Bolivia born Marcelo Claure, is a relative unknown who founded global mobile phone distributor, Brightstar Corp. in 1997 when he was just 27 years old. He built Brightstar from a small phone retailer into the largest Hispanic owned business in the US, a multinational distributor operating in 50 countries with over $10 billion in annual revenues. Sprint's parent company Softbank acquired a 57% interest in Brightstar in October, 2013 and Claure has been a member of Sprint's board since January
Claure has a tough job ahead of him as Sprint has serious problems. It's been losing customers and money for years. The "Network Vision" and "Sprint Spark" network upgrades have been moving at a glacial pace compared with similar work at other operators. Sprint has been doing "rip and replace" upgrades where they shut down cell sites for days or even weeks while they upgrade. Customers served by the sites being upgraded experience degraded service or none at all. The other carriers seem to be able to make network upgrades much faster than Sprint and without degrading service for customers.
Sprint's once disruptive pricing, especially in prepaid, isn't even competitive anymore. In spite of having a fourth-rate network, Sprint service carries premium pricing. I believe that the first thing Claure needs to do is to cut plan pricing across the board. When you have the worst network you have no choice but to compete on price while you fix the network.
Lower pricing will likely lead to greater financial losses in the sort term. But if Sprint/Softbank can afford to buy T-Mobile, it can afford short term losses to buy some market share.
Claure also needs to promptly fix whatever it is that makes Sprint's network upgrade process so slow and disruptive to customers. And if Sprint wants to acquire something, how about buying up regional CDMA carriers like U.S. Cellular, C-Spire, Cellcom, nTelos, Shentel, Appalachian Wireless and Bluegrass Cellular to expand its coverage into new markets.
Finally Sprint needs to start making headlines and earning goodwill with new customer friendly initiatives like T-Mobile has been doing with it's "un-carrier" strategy. A good place to start is by removing the arbitrary restrictions on which phone can be used on which Sprint brand or service. Sprint, Boost Mobile, Virgin Mobile (including payLo) and Assurance Wireless all use the same network, there's no fundamental technical reason why a customer shouldn't be able to use a Virgin Mobile or Sprint phone on a Boost plan or vice-versa.
I'm really hoping new leadership and the end of the distraction of the T-Mobile deal can turn Sprint back into the scrappy competitor that shook up the mobile industry in 2006 with Unlimited by Boost Mobile, a $50/month unlimited talk, text and data plan. At that time time unlimited everything was only available to postpaid customers for $120/month or more. The $50 unlimited plan gained Sprint a lot of favorable press and customers and forever changed the way mobile service is sold and priced in the US. However, to make the sort of sweeping changes that are needed, Claure needs the full support of his boss, Softbank CEO Masayoshi Son and the Sprint board. Lets hope he has it.
Image: "Marcelo-claure" by Mattkholland - Licensed under CC BY-SA 4.0 via Wikimedia Commons.