The wireless and telecom industries are a perfect place to look if you want to see some competitors doing well and others struggling in the same space.
An example is how Verizon Wireless and AT&T Mobility are rapidly growing, but others like Sprint Nextel have been struggling for years.
Why? They are in the same space. They are all updating their networks as fast as they can toward the smart phone future.
They should all be roughly in the same boat. But they are not.
Companies like Verizon Wireless and AT&T Mobility have been kicking butt over the last many years while Sprint Nextel has been struggling.
One reason may be what we see happening right now.
Dan Hesse the CEO of Sprint Nextel wanted to acquire MetroPCS. This would have given Sprint a bigger footprint, more customers and a bigger slice of the pie.
True, mergers have not worked well for Sprint Nextel in the past. Just look at the Nextel part of their name. That was one of the items that caused them to go off track and they just have not been able to get back on track yet.
Would MetroPCS have been good or bad for Sprint? That is the question.
However the board of directors said no, so anything else is just chatter.
Why did they say no? I would say bad experience with Nextel and a shortage of capitol.
First of all every deal does not come up smelling like roses. Unfortunately many deals don’t. However we have seen many deals in this industry like SBC acquiring AT&T, Bellsouth and Cingular which seems to have worked out well for them.
So a fear of doing deals in this marketplace is foolish.
Money may be a different story. They have to be strong financially, and Sprint just has not been for many years.
Too bad, this rejection of the MetroPCS deal just shines a light on the pitiful position Sprint Nextel is in as the number three provider right now.
Hopefully they can turn things around. However I have been saying that for quite a few years haven’t I?
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Please attribute to Jeff Kagan, Tech Analyst with www.jeffKAGAN.com
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Jeff KAGAN| Tech Analyst www.jeffKAGAN.com
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