sk telecom

Sprint offers voluntary package to employees

Phil Goldstein — Thu, 13 Nov 2008 10:48:47 -0500

Sprint Nextel is instituting a voluntary separation package for its employees, giving them until Dec. 3 to leave the company voluntarily.

The beleagured carrier, which lost 1.3 million net subscribers in the third quarter, has not announced any layoffs as part of the plan.

"What is happening is Sprint is offering a personal decision for employees to take advantage of a voluntary separation package," said Lisa Zimmerman-Mott, a Sprint spokeswoman. Zimmerman-Mott said the offer was made to most employees that don't have direct access to customers.

"No one is being forced to do anything," she said. "There are no forced reductions. There are no layoffs in store. It's a matter of employees having the option to exercise discretion. No targets have been announced."

Separately, SK Telecom announced that it was dropping plans to form a business tie-up with Sprint because of worsening economic conditions, according to the South Korean news agency Yonhap.

The South Korean telecom giant had been in talks with Sprint over a possible alliance since late 2007.

For more:
-see this article on the voluntary separation package
-see this post of the VSP
-see this article on the SK Telecom move

Related Articles:
Sprint loses 1.3M net subs, base drops to 50.5M
Sprint customers continue to flee, base drops to 51.9M

SK Telecom's net profit drops 57 percent in wake of Helio deal

Phil Goldstein — Wed, 29 Oct 2008 10:47:20 -0400

SK Telecom saw its third quarter net profit drop by 57 percent, as it faced steeper marketing costs.

South Korea's leading mobile operator saw its net profit plunge to $228.5 million, down from $547.4 million last year. Sales increased 3 percent to $1.992 billion, up from $1.938 billion, but its operating profit dropped 6.1 percent.

The carrier also saw a quarter-on-quarter loss from its sale of flagging MVNO Helio to Virgin Mobile USA, which ocurred in late June. The deal closed at the end August.

As part of that deal, SK Telecom and Earthlink, which were the major shareholders of Helio, got 13 million shares of Virgin Mobile USA common stock, valued at $39 million. SK Telecom also invested $25 million, along with the Virgin Group, directly into Virgin Mobile USA, as part of the deal.

In their official earnings release, SK Telecom said, "The QoQ decrease in equity in losses of affiliates was mainly due to decreased losses from the affiliates such as HELIO."

For more:
- see this article (sub. req.)

Related Articles:
Virgin Mobile USA completes Helio acquisition
EarthLink loses $111.3M on Helio in 2007

Virgin Mobile USA CFO steps down

Phil Goldstein — Wed, 17 Sep 2008 10:15:56 -0400

Virgin Mobile USA's Chief Financial Officer, John Feehan, announced he would be stepping down to become the CFO of Lifelock, an identity theft protection company.

Feehan joined Virgin Mobile USA in 2001 as one of its first employees and became CFO in 2006. The move comes as Virgin Mobile USA announced that it was appointing Richard Chin and Sungwon Suh from SK Telecom to its board of directors in the wake of Virgin's acquisition of Helio and SK Telecom's related investment in Virgin.

For more:
-see these press releases

Related Articles:
Virgin Mobile USA completes Helio acquisition
It's official: Virgin Mobile USA is in talks with Helio

Virgin closes Helio deal

Sue Marek — Mon, 25 Aug 2008 10:50:53 -0400

Virgin Mobile USA completed its planned acquisition of Helio. Helio shareholders SK Telecom and Earthlink have received shares and limited partnership units equivalent to 13 million shares of Virgin Mobile stock valued at $38 million. In addition SK Telecom and Virgin Group will each invest $25 million in Virgin Mobile USA. SK will have a 17 percent investment in Virgin Mobile and two seats on the Virgin Mobile board of directors.

The deal, first announced in late June, was contingent upon certain requirements--mainly that Helio had to cut its sales and distribution costs prior to acquisition. Virgin said all terms and conditions had been met and necessary regulatory approvals obtained.

For more:
- Read this release

Related stories:
Virgin buys Helio for $39 million
Helio closes all but one retail store

SK says it's not planning to buy Sprint

Sue Marek — Thu, 17 Jul 2008 11:21:27 -0400

SK Telecom confirmed that the company has no plans to buy Sprint Nextel or any other major U.S. wireless company. Earlier this week, rumors circulated about a potential merger between the two after a CNBC story said that the two were in talks. That report was later debunked saying instead the two were considering a partnership in which they would jointly develop handsets and services. SK has now confirmed that it is considering various business opportunities in the U.S. but not seeking to take control over any major U.S. operator.

If the two are considering jointly developing handsets and services, most agree it would be beneficial to both. SK, while much smaller than Sprint, has similar partnerships with carriers in countries such as China and could help build scale. In addition, SK is known to be technologically advanced and has recently been offering handset-based video conferencing.

Meanwhile, Sprint has shown some signs of a rebound. The company's new Samsung Instinct phone is selling well and the company is expected to have improved its churn when it reports its second-quarter earnings on Aug. 6.

For more:
- see this Kansas City Star report

Related stories:
SK and Sprint: considering alliance, not merger
SK Telecom contemplating Sprint acquisition
Virgin buys Helio for $39 million

SK and Sprint: considering alliance, not merger

Sue Marek — Wed, 16 Jul 2008 11:22:53 -0400

Yesterday's CNBC story about potential merger between SK Telecom and Sprint is being debunked today. Instead, the Wall Street Journal and a few other news outlets are reporting that SK Telecom and Sprint are considering a partnership in which they would jointly develop handsets and services. Last November, Sprint rejected a $5 billion investment offer by SK Telecom and Providence Equity Partners and WSJ sources say that any investment that results from the current talks would be much smaller.

In a blog posting yesterday about the rumored deal, Pali Research analyst Walter Piecyk said that since that first offer last November Sprint's fundamentals have eroded. He also speculated that SK might be considering an equity investment in Sprint and not a merger.

Recently Sprint has shown some signs of a rebound. The company's new Samsung Instinct phone is selling well and the company is expected to have improved its churn when it reports its second-quarter earnings on Aug. 6.

In late June, SK Telecom invested $25 million in equity capital in Virgin Mobile USA as part of Virgin's acquisition of MVNO Helio. SK will have a 17 percent investment in Virgin Mobile and two seats on the Virgin Mobile board of directors. The deal is supposed to close in the third quarter.

For more:
- see this WSJ report (sub. req.)

Related stories:
SK Telecom contemplating Sprint acquisition
Virgin buys Helio for $39 million

SK Telecom contemplating Sprint acquisition

Sue Marek — Tue, 15 Jul 2008 16:14:21 -0400

Rumors are circulating that South Korean operator SK Telecom may acquire Sprint Nextel. According to CNBC, private equity firms would join SK Telecom in the possible buyout and would contribute cash toward the deal, which would be very complex.

If this report is true, this is the second time that SK Telecom has made a bid for Sprint. In November, the Wall Street Journal reported that Sprint rejected a $5 billion investment from SK Telecom and PE firm Providence Equity Partners that included installing Sprint's former chairman Tim Donahue as CEO of the company. Donahue and the PE firm proposed the deal to Sprint in a letter dated Nov. 10, according to the report, but Sprint did not grant the former chairman or the firm a meeting to discuss the proposal before declining.

In a blog posting about this recent rumored deal, Pali Research analyst Walter Piecyk said that since that first offer Sprint's fundamentals have eroded. He speculates that instead of purchasing Sprint, SK might instead be considering an equity investment.

For more:
- read this CNBC report

Related story:
Sprint rejects SK Telecom's $5B investment

Will Virgin Mobile really benefit from Helio?

Lynnette Luna — Mon, 30 Jun 2008 03:59:11 -0400

Struggling MVNO Helio was able to avoid the humiliation of going out of business by finding a savior in Virgin Mobile, which announced its intention to purchase the company for a mere $39 million from EarthLink and SK Telecom for 13 million shares of Virgin Mobile stock. Moreover, the deal was even sweeter for Virgin because both EarthLink and SK Telecom agreed to invest $25 million in equity capital in Virgin.

Virgin says that the Helio deal will be good for the MVNO because it will allow the company to offer differentiated data applications and enter the postpaid market. Helio has approximately 170,000 subscribers with an ARPU of about $80 and a handset inventory of 85,000 devices valued at $17 million.

But you have to wonder how much of a difference such an acquisition will make on Virgin's competitive position in the long-run.

Virgin launched in the U.S. with a razor-sharp focus on the prepaid youth market, a strategy that CEO Dan Schulman himself in the past has said is a critical factor to the success of the MVNO because it differentiated the company from wireless competitors. Now Schulman says it is necessary to compete with a postpaid product with the help of the Helio acquisition because 20 percent of the firm's disconnects come from customers going to postpaid products.

But this move into the postpaid market, and it's recent launch of an unlimited minutes plan for $80, puts Virgin competing head-to-head with national operators for the higher class of consumers--a segment where the stakes are higher and competitors are even more fierce for these lucrative customers than in the prepaid market. Moreover, what if we see an all-out price war break out among the nation's operators? Can Virgin negotiate even better wholesale terms on Sprint's network? Plus, pushing into the postpaid market requires a better market presence, which translates into higher marketing costs.

These days, Virgin seems to be losing its differentiation by pitting itself against national operators. What happened to the edgy company that launched in 2002 with a half-naked Sir Richard Branson sliding into Times Square promising cool content and no BS pricing to the youth market? The Helio acquisition does bring 3G capability to Virgin, giving it the ability to differentiate itself once again with cool content such as video and music. But it has to tread carefully. Other MVNOs such as Amp'd Mobile that have tried to take on national carriers by differentiating themselves with content services have all gone out of business.

If Virgin doesn't keep its original business plan in mind as it uses Helio's assets, the acquisition will have little impact on Virgin's competitive position. --Lynnette

No surprise here: Helio and Virgin Mobile talks fall apart

Lynnette Luna — Mon, 23 Jun 2008 00:35:13 -0400

It's not surprising to hear that merger talks between Virgin Mobile and SK Telecom's Helio have fallen apart and that Helio stores will shut down soon. Back in May, the two MVNOs announced they were in preliminary talks. The two companies, however, have little synergy.

Helio was heavy on content and 3G while targeting higher spending consumers--those willing to pay about $70 per month, while Virgin Mobile has remained focused on the prepaid, credit-challenged youth market, not getting caught up in complex user interfaces and applications. And CEO Dan Schulman has been quite clear that he doesn't want to deviate from this focus.

Moreover, both companies aren't fairing well financially. The last we heard about Helio's financial position was from 2007, when Helio reported it lost $327 million on $171 million of revenue. Meanwhile, Virgin made $4.2 million of profit on $1.3 billion of revenue in 2007, but this year it is struggling with a sagging economy and its stock price. Financial analysts expect the company to lose customers throughout 2008 and face more intense competition in the prepaid arena from large operators. Virgin is in no financial position to buy a money-bleeding MVNO whose business model has no comparison to its own.

What does this all mean? Helio, if it does shut down soon (and I have no doubts that it will), will mark the end of an era. Its demise will be the last of the content-heavy class of MVNOs that included Mobile ESPN, Disney Mobile and Amp'd Mobile. And Virgin will remain the MVNO anomaly that will be a little worse for wear in 2008. --Lynnette

It's official: Virgin Mobile USA is in talks with Helio

Brian Dolan — Wed, 14 May 2008 11:21:25 -0400

After a week of speculation and rumors about a possible tie-up between Virgin Mobile USA and SK Telecom's MVNO Helio, Virgin Mobile has finally come forward and announced that the two are in preliminary talks. Virgin Mobile's brief statement characterizes the talks as "in early stages" and cautions that no transaction may result. The MVNO said it will have no further comment on the talks unless a definitive agreement takes place. Just yesterday, SK Telecom denied reports that it was in talks with Virgin Mobile USA about a possible tie-up.

If Virgin Mobile USA were to acquire Helio, it would mark the end of an era: Now that Mobile ESPN, Disney Mobile and Amp'd Mobile have ceased MVNO operations, Helio is the last big MVNO in operation from the content-heavy class of virtual operators.

For more:
- read Virgin Mobile's statement about Helio talks

Sprint, Clearwire WiMAX Merger Timeline

Mike Dolan — Wed, 07 May 2008 12:25:13 -0400

Timeline of Sprint, Clearwire, WiMAX

5-6-08 - Report: Sprint considers Nextel spin-off

5-6-08 - Qwest drops Sprint, taps Verizon for wireless

5-5-08 - T-Mobile USA to merge with Sprint Nextel?

5-2-08 - Sprint appoints Brust as CFO

4-24-08 - Cable companies exit Pivot JV with Sprint

4-4-08 - Backhaul bottleneck reason for Xohm's woes?

4-3-08 - Sprint's Xohm has been delayed

3-26-08 - Report:Cable MSOs to invest in Sprint-Clearwire

3-19-08 - Analyst: Intel unlikely to invest $2B in WiMAX

3-18-08 - Sprint round-up: Board exits; lawsuit; unlimited ad

3-12-08 - SPOTLIGHT: Sprint shares near 20 year low

3-10-08 - Sprint, it's time to take the money

3-6-08 - Sprint's troubles inspire rumor mill

3-4-08 - Clearwire adds 47,000 subscribers

2-29-08 - SPOTLIGHT: Sprint should not have bought Nextel

2-28-08 - Hesse: Sprint's issues more difficult than expected

2-22-08 - Sprint: We'll make Xohm SDK available

2-15-08 - Rumor Mill: Intel investing $2B in Sprint/Clearwire

2-6-08 - Report: Kuwaiti firm eyes Sprint, Clearwire

2-4-08 - SPOTLIGHT: Is Sprint worth saving?

1-31-08 - Clearwire confirms deal talks with Sprint

1-30-08 - Sprint commits to iDEN, revives Clearwire talks

1-24-08 - Sprint cuts CFO, CMO and sales head

1-3-08 - Analyst predicts Sprint's Q4 will be ugly

12-18-07 - Hesse to take helm at Sprint

12-12-07 - Sprint soft launches WiMAX in three markets

11-30-07 - Sprint rejects SK Telecom's $5B investment

11-28-07 - Analyst: Sprint and Clearwire to reunite?

11-12-07 - Rumor Mill: Google buying Sprint?

11-9-07 - Sprint and Clearwire call off WiMAX JV

11-2-07 - Sprint's about-face on Pivot

11-2-07 - Sprint mulls WiMAX spin-off again?

11-1-07 - Sprint's net income plummets 77 percent in Q3

10-10-07 - Post-Forsee, Sprint faces pressure over WiMAX

10-9-07 - Sprint CEO Gary Forsee is out

10-5-07 - Report: Sprint's board wants new CEO by Dec.

10-4-07 - Investors lose confidence in Sprint CEO

9-24-07 - SPOTLIGHT: Chicago gets WiMAX preview

8-27-07 - Samsung gets Sprint's NY WiMAX market, too

8-24-07 - Can Sprint keep WiMAX expectations in check?

8-17-07 - Xohm Steals the Spotlight

8-17-07 - Sprint may triple backhaul assets for WiMAX

8-16-07 - Sprint outlines "Xohm" WiMAX plans

8-7-07 - Clearwire reveals more on Sprint partnership

8-1-07 - FiberTower inks backhaul deal for Sprint's WiMAX

7-26-07 - Sprint inks deal with Google for WiMAX network

7-19-07 - Sprint and Clearwire merge WiMAX networks

7-19-07 - Sprint and Clearwire pool WiMAX networks

7-18-07 - Sprint taps ZTE for WiMAX data cards

3-27-07 - Sprint expands WiMAX markets, devices

2-8-07 - SPOTLIGHT: Sprint taps Samsung for DC WiMAX

1-2-07 The WiMAX hype will continue

Sprint, it's time to take the money

Mon, 10 Mar 2008 07:59:59 -0400

Sprint, it's time to take the money

The rumors are rife over acquisition and spin-off scenarios for troubled Sprint. Deutsche Telekom might make a play for Sprint, Sprint may spin off Nextel and Verizon might try to buy Sprint.

The bottom line is: There is no easy fix for Sprint. CEO Dan Hesse recently admitted that the problems facing the operator are more difficult than he anticipated. He's already done a lot internally, cutting 4,000 jobs, reducing the number of distribution points and consolidating the the company's headquarters. Now it's time to make the drastic moves, and one has to be looking for outside investments.

Back in December, Sprint reportedly wouldn't even entertain a $5-billion investment from SK Telecom and PE firm Providence Equity Partners that included installing Sprint's former chairman Tim Donahue as CEO of the company (I have a feeling it was installing Donahue that was the sticking point since former Sprint and Nextel executives love to point the finger at who messed this acquisition up). Now it's time to start courting the PE firms and foreign investors who want a piece of the U.S. wireless market.

Many private equity firms have funds to spend, and they want to spend it in the telecom industry these days. We've seen some high-profile private equity moves in telecom recently, including the buyouts ofÃ‚Â Covad Communications, Bell CanadaÃ‚Â and Alltel Wireless.Ã‚Â

Analysts predict that with the economy teetering, PE firms will look to telecom carriers and vendors who have high cash flow and manageable debt as new investment opportunities. The beauty of privately led leveraged buyouts is that investment groups have the ability to reshape the business in a manner that previous management and relationships could not and without investors breathing down their necks. These companies have the financial capability to buy other companies that will complement some of these businesses. They can sell non-core businesses and add to the core capabilities. The net result can be a high-value company. -Lynnette

SK Telecom and Citigroup ink mobile banking JV

Thu, 06 Mar 2008 06:59:56 -0500

SK Telecom and Citigroup announced plans to launch a $16 million joint venture called Mobile Money Ventures that will provide users with advanced mobile financial services. Each partner will pay $8 million and maintain 50 percent ownership of the JV, which will be based in San Francisco. The new entity aims to offer services like transaction record-keeping, securities transaction and location-based advertisements.

For more on the JV:
- read this article from Thomson Financial

Helio: Losses up, revenue up too

Fri, 29 Feb 2008 06:59:56 -0500

Mobile virtual network operator Helio continues to hemorrhage cash...but on the bright side, its 2007 revenues increased 264 percent over the previous year. In its annual report to the SEC, Internet service provider EarthLink, which launched Helio in conjunction with Korean mobile operator SK Telecom, notes Helio lost $327 million in 2007 against $171 million in revenue; a year ago, the MVNO posted losses of $192 million on $47 million of revenue, which combined with 2005 losses of $42 million means Helio has now posted total losses of $560 million in three years. Helio ended the fourth quarter with slightly more than 180,000 subscribers, a 28 percent increase over Q3 totals. But while revenue still exceeded Helio's $140-$170 million guidance, and losses fell shy of its $340 million to $360 million guidance, EarthLink admits in the SEC filing it "may not realize the benefits we sought from our investment in the Helio joint venture."

The EarthLink filing goes on to note "We have made $210 million of cash investments in Helio. The financing of Helio's operations has adversely affected our cash position. In addition, Helio will require additional funding in the future and Helio has incurred losses and we expect Helio to continue to incur losses. In addition, Helio may not be successful in implementing and marketing its wireless voice and data initiatives, and there can be no assurance that these initiatives will be commercially successful. We cannot assure you Helio will be able to achieve or maintain adequate market share or revenue or compete effectively." -Jason

For more on Helio's 2007 results:
- read this Silicon Alley Insider article

Related articles:
Helio gets Buzzd.
Sky Dayton resigns as Helio CEO.
SK Telecom pumps another $270M into Helio.

Earthlink lost $111.3M on Helio last year

Fri, 08 Feb 2008 06:59:56 -0500

Because Earthlink reduced its investment in Helio, which it co-owns with SK Telecom, to zero during the third quarter of last year, the company will no longer record its share of the MVNO's net loss. For all of 2007, EarthLink's share of Helio's net loss amounted to $111.3 million.

In general, the fourth quarter included $32.1 million in losses related to muni WiFi, while the full year included $80.3 million in losses related to the discontinued operations related to the municipal WiFi assets. That compares to the $6.9 million and $20.0 million, respectively, during the fourth quarter and full year 2006.

For more on Earthlink's losses:
- read this press release

Korean cable companies following Pivot's lead?

Fri, 18 Jan 2008 06:59:55 -0500

According to a report in the Korea Times, the Korean Cable TV Association said some of its members are planning on adding wireless services to their bundles by reselling handsets and services from existing carriers. The cable companies are looking to partner with SK Telecom, KTF and LG Telecom for the joint venture. The move should be a familiar one to the U.S. wireless and cable industries--Sprint inked deals with Comcast, Cox, Advance/Newhouse and Time Warner in a joint venture later marketed under the brand Pivot. The JV never really took off, however, and Sprint has slowly ramped down its involvement with the cable firms.

For more on Korea's Pivot:
- read this article from the Korea Times

Related Articles:
Pivot's cable companies to go it alone Article
Time Warner: Pivot demand "tepid" Article
Sprint's about face on Pivot Article

Analyst predicts Sprint's Q4 will be ugly

Thu, 03 Jan 2008 06:59:58 -0500

UBS telecoms analyst John Hodulik wrote in a research note that Sprint's fourth quarter results are going to be ugly, which shows how much work newbie CEO Dan Hesse has ahead of him. Hodulik predicted that Sprint would post a net loss of 400,000 post-paid subscribers, while ARPU will show an accelerated drop. The analyst also said wireless margins will show a marked drop year-over-year to 29.1 percent of sales.

For more on Hodulik's analysis:
- read this post over at Barron's Tech Trader Daily

Related Articles:
Embarq loses Hesse to Sprint top job Article
Hesse paid $1.2M a year at Sprint Article
Sprint rejects SK Telecom's $5B investment Article

The MVNO love affair is over

Fri, 21 Dec 2007 06:59:55 -0500

Two years ago there was a new acronym in the wireless industry and many analyst reports predicted that it signified the next big thing: mobile virtual network operator, or MVNO. Earlier this year two of the biggest MVNOs in the U.S. crashed and burned: Amp'd Mobile and Disney Mobile. Their demise followed closely on the heels of Mobile ESPN's closing in 2006.

Disney Mobile, which launched in June 2006 using the Sprint network, ultimately discovered that it could not lure as many subscribers as they originally hoped they could from the big carriers' family plans. Innovative mobile content and special services like Disney's family-finder application pushed the industry to support more location-based services, but weren't enough to convince subscribers to join Disney to get their hands on them. The service will remain live through Dec. 31 and Disney has offered to reimburse subscribers who purchased handsets, accessories and content through the company. The fate of Disney Mobile's 120 employees is presently under discussion.

Amp'd had subscriber acquisition problems of its own, but rumors circulated that the real poison pill for this MVNO was its subscribers' inability to pay their bills. Despite having more than $360 million in venture capital financing and 200,000 subscribers, Amp'd had more than $100 million in debt, owing some $33 million to Verizon Wireless for network operations and at least $16.4 million to Motorola for handsets. The embattled MVNO alerted subscribers that it was shutting down its service via text message in mid-July.

Now that Amp'd and Disney shuttered their doors, few are bullish on the MVNO model in the U.S. Well, that is, with the exception of SK Telecom, which keeps investing hundreds of millions of dollars into Helio.

Hesse to take helm at Sprint

Tue, 18 Dec 2007 06:59:58 -0500

Sprint Nextel has tapped Dan Hesse to be its new president and CEO, replacing Gary Forsee who stepped down from the helm in October.

Hesse, who has been chairman, president and CEO of Embarq since its inception in 2006, is no stranger to the wireless industry. He spent 23 years at AT&T, including serving as president and CEO of AT&T Wireless Services from 1997 to 2000. During that time, he is credited for convincing senior AT&T management to support AT&T Wireless' Digital One Rate plan. This plan was the first in the wireless industry to bundle roaming and long distance fees into a flat-rate airtime package for consumers. Digital One Rate was a huge marketing success. Other nationwide operators copied the Digital One Rate plan, which caused demand for wireless services to skyrocket.

Hesse will have his hands full turning Sprint around. The firm has struggled with its 2005 merger with Nextel and has been losing iDEN customers at an alarming rate. Also in question is the firm's WiMAX plans. Sprint's deal with Clearwire fell through and some see the WiMAX business case as being risky.

According to the Wall Street Journal, some of the Sprint board members are hoping that Hesse will consolidate the company's operations in Kansas City, which could potentially save the firm lots of money.Ã‚Â

For more:
- see this press release
- see this WSJ article, for more details. (sub req.)Ã‚Â

Related Articles:
Who's got next at Sprint? Article
Sprint rejects SK Telecom's $5B investment Article
Embarq announces job cuts, profit dip Article
Sprint mulls WiMAX spin-off again? Article

Again, where have all the iDEN subscribers gone?

Mon, 03 Dec 2007 06:59:59 -0500

Again, where have all the iDEN subscribers gone?
It was about this time last year that I was asking where have all the iDEN customers gone at Sprint Nextel? The question is still applicable today. Nextel push-to-talk customers--once the most loyal and highest revenue-generating subscribers in the industry--continue to defect at an alarming rate. According to Walter Piecyk at Pali Research, Sprint now has fewer iDEN customers on its network than in 2003, and the firm believes the customer base is likely to drop to less than 10 million. It says a lot when a Nextel customer rather switch from instantaneous PTT conversations to a regular mobile phone.

So I find it perplexing that Sprint reportedly wouldn't even discuss a $5-billion investment from SK Telecom and PE firm Providence Equity Partners that included installing Sprint's former chairman Tim Donahue as CEO of the company. Doesn't the company owe it to investors to investigate any proposed turnaround strategy that appears as legitimate as this?

Donahue was the president and CEO of Nextel prior to the 2005 merger and has experience with new technology and managing its expectations. And he certainly can turn around the lagging iDEN business. In the 1990s, Nextel's iDEN service was a new concept as was the PTT business model, but Donahue and his team sold blue-collar professionals on the idea. As a result, Nextel experienced record setting financial results under Donahue's leadership, with nine straight quarters of positive net income. Under his watch, Nextel had an eye on the future, testing high-speed data technology and even considering a flip to CDMA.

Then came the merger with Sprint in 2005. The integration has gone terribly wrong, and some blame Donahue. However, it was Sprint management who ran the business into the ground, while heavily pushing consumer CDMA services and touting the coming benefits of WiMAX. Now Sprint is CEO-less, and things are deteriorating even faster, Piecyk believes. You wouldn't even know that Sprint has a PTT business today.

How long will Sprint take to find a CEO willing to make the hard decisions to turn the company around even though a perfectly fine candidate has jumped into its lap? -Lynnette