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Dan Hesse in Hot Water With Sprint’s Board of Directors?

Posted In Featured, News - By Mark Hearn On Tuesday, March 13th, 2012 3:45pm PDT With 29 Comments

If you ask some of Sprint’s current shareholders, frontman Dan Hesse is walking a fine line. But it appears that they’re not the only ones questioning the CEO’s decision making lately. A report from the Wall Street Journal is claiming that Sprint’s board of directors is taking a very hands-on approach at dealing with Hesse and what some would call his recent run of blunders. This move comes after complaints from disgruntled investors about Sprint’s current financial situation.

About five years ago, Hesse took over a troubled Sprint, which was still mending its wounds from a botched acquisition of Nextel that did more harm than help. With Hesse as their new face, the company struggled to rebuild and rebrand itself focusing on promoting change and customer service improvements.

As the company’s public image improved, its financial woes remained. This resulted in a round of investments led by Hesse that have yet to pan out. With expensive plans to launch a new LTE network later this year and investor’s patience continuing to thin, Sprint’s board could very well lose its confidence in Hesse as a leader, which could  result in the CEO losing his paycheck.

 

Source: WSJ

About - Mark is the founding father of SprintFeed. He is a nerd's nerd if ever such a thing existed. His love affair with the Now Network started with the release of the Treo 600 back in 2004 and has been going strong ever since. Highly opinionated and somewhat eccentric he shares his ramblings about his network of choice here at SprintFeed.

Displaying 29 Comments
Have Your Say

  1. Daniel Bobke says:

    He has done some good things…five years ago, Sprint had crappy customer service and their selection of phones was the worst of all the major carriers. Those things have definitely turned around, but a major strategic blunder was the WiMax decision. The cost of now essentially setting it aside and going with LTE is extremely high – and it has eroded the confidence of not only shareholders and the BoD, but of customers as well. For me, I am not about to renew my contracts (family plan) until I feel more confident that the LTE network is actually going to happen and that they are going to be able to move forward financially.

  2. seven2k says:

    that apple deal did him in. They could of gone with exclusivity with Galaxy Nexus.

  3. WillieFDiaz says:

    Sprint was in hot water before him. Their failure to force migrate and cannibalize Nextel into a CDMA network as well as not invest in EVDV and EVDO rev.B to keep going without WiMAX, and the major shareholder/board decision to nix MetroPCS merger is all the issues that were around and shareholders and board chose to not to have confidence in. Dan tried to facilitate, lower prices, and prep Sprint to be attractive for a merger should one arise, but his board and shareholders have held him back. Sorry, but he took failing AT&T Wireless after their botched GSM Next Generation Network deployment and turned them into a company ripe for picking at a higher then worthy price. Sprint board is stupid for failing to buy out Metro solely for LTE spectrum in major markets that can be sold to TMobile and the 1900 spectrum Sprint could gain for their own network in needed markets like California. Sprint board needs to go, not Dan.

  4. ChadBroChillz says:

    I can see where the investors are coming from, but I feel like hesse has done a ton of good for the company. Some of the trouble they were in was from the previous management group. Wimax was a necessary evil, especially since if they did not rollout with wimax, they would have lost the rights to that spectrum. Their LTE plan is going to save them money in the long run, and the Apple deal is already netting them customers and retaining current postpaid subscribers. Sprint had to change its image before it could see profits, and it change its image, it had to reinvent its network as well as improve is phone portfolio.

    I think it would be smart for them to stick with Hesse as CEO. Once the Sprint LTE iphone comes out, they will see more people jump to Sprint over ATT/Verizon.

  5. Freak4Dell says:

    If he does lose his paycheck, good riddance. How this man ever got to the position he is at, I will never figure out.

  6. Guest says:

    I don’t see this as good news, regardless of Hesse’s successes or failures. The board of directors at Sprint has long been making poor decisions dating well before Hesse’s time (Sprint Ion, anyone? Exactly). Additionally, over Sprint’s decline they have routinely made moves that hurt the company while protecting executives.

    I can’t speak to whether or not Hesse should stay or go but I get nervous about the idea of Sprint’s board making significant moves with an upcoming transition to LTE serving as the perfect excuse to ditch unlimited data and improve profit forecasts at the expense of customers. It’s that much easier to make happen if the “face” of unlimited data is out of the way.

  7. Sin City says:

    It seems that the majority of people who mentions Sprint’s WiMax blunder, never bring up the fact that the FCC forced them to use that spectrum, or lose it forever. LTE wasn’t in the picture at all.

  8. Sin City says:

    EVDV was DOA because of Verizon and the carriers turning away from it. EVDO Rev. B I agree with, but by time both carriers thought about it, LTE was the future. Everything else, 100% agree.

  9. F1 says:

    NEXTEL yesterday, WIMAX today, Micky Mouse LTE tomorrow…

    Dear Reader;

    I have been a SPRINT Customer since 1997, yes since the very beginning in SoCa,
    I did leave SPRINT briefly after the NEXTEL merger, for just under a year.
    Over the years I have seen quite a few changes at SPRINT.

    Today’s customer service experience, is at last on par with the quality at the very start,
    that is all that sums up CEO Dan Hesse’s positive legacy for me, he was a former AT&T executive, past on to us by NEXTEL’s Forsee, yes the very same one that let go of every remaining potential executive material, before his term was up some five years ago.

    Millions of Veteran SPRINT Customers, are forced to change “Legacy Plans” to less Minutes & Features for more dollars, meaning that if they consume a range of 100-200 minutes a month for $30 a monthly CLEAR Plan, they have no choice but to give up the plan for a new device, say $75 after Tax and Fees for 450 minutes.
    In this Economy, it would make sense to attempt to keep veteran customers happy, and offer low cost plans, with a wider range of hardware choices, thereby not making people feel like second class citizens, and at the same time reach out to more potential outside Customers.

    I have had a Fair & Flexible 700 Plan, for the past five years, including unlimited Text/Data, starting at 6 pm anytime, additional 100 minutes $5 buckets or 5 Cents per minute, which I have never once utilized, including my discount and Taxes & Fees at under $50 a month…

    I’m currently on my ninth replacement PALM PRO 850 sold/issued to me back in 2009,
    if I wanted to replace “the Original Windows Touchscreen Smartphone”, SPRINT gives me a choice of a handful of basic Flip-phones or “the tenth refurbished PALM PRO” for $35 !

    In short, Dan Hesse only “invested” in some of other carrier’s customers, not a dime on SPRINT’s own so called “Legacy Plan” Customers, so as a result they have left SPRINT by the millions, and continue leaving SPRINT Everyday!

    Oh by the way, I have been off Contract since January 1st 2010,
    the last time SPRINT surveyed my “Customer Service Experience”, it was back in 2009, you can draw your own Conclusions, in terms of Hesse’s longterm planning skills as a CEO of SPRINT.

    Thank You

    SPRINT Accountholder Since 1997

  10. Oversight68 says:

    It’s one of those things that is public knowledge, but it’s not common knowledge. I think for most people, they simply don’t know that small detail and don’t want to look at the bigger picture.

  11. Oversight68 says:

    Not really. Without the iPhone, Sprint lost hundreds of thousands, if not millions of customers to AT&T or Verizon over the last several years. That means less revenue and higher costs to bring new customers in to make up the difference. Neither are good in the long run. Like it or not, the iPhone is a must have device for Sprint.

  12. G.O.A.T. says:

    I’m sorry but you are not a profitable customer. Consistent, but not profitable. No company supports “legacy” customers like that. If you want a new phone you get a current plan, unless you find a new phone compatible with your old plan. Look at how AT&T treats their grandfathered unlimited data customers. Sprint hasn’t changed anything about your plan and will still service a device not under warranty and replace it for you. Seems fair…

  13. Luke Foelske says:

    How would that have helped them? They don’t have an LTE network up and running yet.

  14. Acaciastrain says:

    The dude was head of AT&T Wireless at one point. He knows what he is doing. Not to mention the Bachelors, Masters, and Doctorate degrees he has.

  15. Gerryf says:

    I’ll bet all those directors want Windows Phones….

  16. Phefner says:

    Despite the fact that I’ve been really critical of Hesse lately, I have to say that BoD hasn’t exactly been batting well either. I don’t understand everyone’s obsession with the WiMAX spectrum. 2.5Ghz is essentially useless for any mobile technology. I personally believe Sprint would’ve been better NOT going with WiMAX and focused on EVDO revB upgrades and improving Backhaul speeds instead.

  17. Anton Frost says:

    Yea, what they said. The Galaxy Nexus wasn’t an option without LTE and Sprint would’ve lost customers at launch of the iPhone 4S to the carriers who had it (AT&T and Verizon). Besides, if you really want a Moto Android that’s worth it, it isn’t the Galaxy Nexus. It’s the Moto Razr.

  18. F1 says:

    3 Points you are mistaken & one question for you:

    1. VWZ & AT&T both until just last week, have honored and grandfathered “Legacy Unlimited Data Planes”, why should SPRINT openly discriminate against it’s own veteran accountholders, the definition of “Unlimited Data” has remained the same, yet the execution is bias.
    SPRINT wants to be considered one of “the Big Boys” and yet fails in every aspect. For years SPRINT has been saying that my device or my Plan can systemically not handle today’s Data traffic, well I ran I test, here are the documented results:
    Range of my Data consumption: 32MB Nov 2011 16.6GB Oct 2011
    Average of my Data usage according to SPRINT: ~3.5 GB per month since 2009

    2. SPRINT attempts to change my Plan on a regular bases, just last month SPRINT charged me “two dollars extra” for me to continue to receive my detailed monthly statement!! Pay extra to find out what I get charged for ?!

    3. SPRINT has replaced my brand new Palm Pro 850, with a refurbished unit,
    even though the unit was only three months into the original manufacturer’s warranty, in addition to that, it has not a single time “serviced” any of my 9 replacements, not to speak of the $35 Fee SPRINT has charged me, as much 3 times in a four month span, “30 days exchange on defective refurbished device only”, on the 32nd day SPRINT has charged me $35, for someone else’s recondition/refurbished problem Phone.
    Please feel free, be my guest, go ahead do the math!

    Furthermore I would like to ad the following question:

    Why is it, that you cannot walk in at the SPRINT store, with your own/fully payed for device…i.e. an iPhone or a GALAXY etc…, and have your ESN swapped?
    That would cost SPRINT nothing, and yet it would prevent account losses, not to speak of “full pop” hardware sales profit margins!
    Some executive decisions, leave one speechless, including the very own Regional Director of SPRINT, what could he possibly say?
    Answer: “I will forward your points to the executive office for consideration”

    What happened to the consumer’s rights?
    The FCC will have to look into these practices.
    It is time to take legal action, not just for us the violated Consumers, but also for the Shareholders, for billions of misdirected and lost fund at SPRINT.

    Thank You

  19. F1 says:

    Correction:

    “Legacy Unlimited Data Plans”

  20. F1 says:

    Check out Forsee & Hesse!

  21. F1 says:

    All that Education, does not mean a thing, if you fail in execution…

    For the record, he did save the face of the Company, by addressing the miserable self destructive Customer Service Nightmare at SPRINT, for that he got compensated tens of millions over the past five years.

    Thank You

  22. ChadBroChillz says:

    If you are building a network strictly on 2.5Ghz, I believe you have a point; but If you are using it to relief capacity, then it is not useless. It has higher capacity than 1900 or lower spectrum, which will be a life saver during capacity constrains.

    Also Nokia Siemens has come out with a technology that can help TD-LTE networks on higher spectrum, since it increases capacity by 80%, coverage by 40%, and reduces cell cost to 1/3rd.

  23. cashd00d says:

    The Galaxy Nexus isn’t made by Motorola…

  24. sonofLA says:

    Dan Hesse has done a great job, he got the iPhone , and broke the company
    To do it!!yay!!

  25. okc613555 says:

    OK so lets do the math on this over the course of four years you have paid sprint 2400 in service while using 3.5 gigs of data every month you are on your 10th phone including your new phone you got in Jan of 2008 the subsidy on the first device was 300 dollars.you then received 9 replacement phones the 35 dollar fee only went into effect this past summer so ill assume you have paid 4 fees equaling 140 so you have paid sprint 2540 dollars oh hell ill round it up to 2700 dollars minus 300 for the original subsidy and probably around 150 for each refurbished device yes they cost money they dont magically appear multiplyed by 9 to equal 1650 dollars plus labor involved with your probable ten million trips to a sprint store or dialing customer care plus it actually cost the company money to do an esn swap being conservative 1000 dollars so Sprint has spent 2650 on you with a grand profit of 50 dollars over the course of four years. Your logic states Sprint should try to hold on to customers like you but if all the customers were like you there wouldn’t be a Sprint. People like you sir are the reason all the rest of us have to pay more money.

  26. F1 says:

    @ OKC613555 (EMPLOYEE ID??)

    Ever heard of ENRON style Accounting?

    Facts vs Fiction:

    Starting in August 2009, not January 2008, SPRINT ran out of my SAMSUNG M 610…which was replaced by SAMSUNG M 800, for which,”I was not qualified for”, do you recall Hesse’s INSTINCT ? Perhaps you remember the “introduction” of the ORIGINAL “EVERYTHING PLAN”!

    SPRINT said, unless you drop your FAIR & FLEXIBLE 700 and change it into an “EP”,
    you have the choices of the outgoing LG ELITE or the PALM PRO 850″ for which I PAID $300!

    The following month PALM announced, it will no longer support WINDOWS MOBILE,
    in preparation for the release of PALM & Hesse’s next ALL EGGS IN ONE BASKET project,
    also known as the “WEB OS”!
    SPRINT knowingly selling garbage, which was the PALM PRO 850 Operating System.
    Within 2 weeks after my 30 days exchange window, SPRINT discontinued the PALM PRO 850 and all support for it, because WEB OS is the new kid on the block, and again,
    “I was not qualified for an EXCHANGE/UPGRADE” either!
    The “PRE EXCLUSIVE” was it for SPRINT, since it was too broke for the ANDROID,
    Hesse said: “ANDROID was not READY for SPRINT” remember the G1? The rest is history as they say.

    According to the SPRINT L.A. Corp Store Tech Supervisor who had himself owned the PAlM PRO briefly, “You know more about the device, than we do”, as an example of confidence of SPRINT “post sale service”:
    For 2 hours they took the phone apart, because it would play the music MP3, however no sound, “perhaps it has a Virus!”, “Window’s OS is really picky”, you mean all 200+ songs have been infected? “it could be, there is nothing more I can do, we can reset the phone and erase all of your files, or order another one”, so I went back late to my meeting, having wasted my time with “SPRINT SERVICE”, later that evening, “I figured it out my self”, see MICROSOFT is so SOPHISTICATED, that when they by accident had switched the phone to silent, MICROSOFT OS would PLAY the song for your enjoyment, however without SOUND or any warning indicator, so when I shared that with SPRINT, they responded, “that is why we don’t support it anymore, why don’t you change your Plan and get the WEB OS ?

    32 months of “Service” @ $50 a month = $1600

    6 (out of 9) replacement PALM PRO 850 units @ $35 a piece = $210

    Original purchase price of $300 (how many device cost $300 today, other than 2 iPhones? )

    Over 1TB of DATA @ 3.5 GB of DATA a month = P R I C E L E S S

    “OK so lets do the math on this over the course of (three and NOT) four years…
    300 for the original subsidy and probably around 150 for each refurbished device yes they cost money they dont magically appear multiplyed by (SIX) 9 to equal 900 dollars plus labor involved with your probable ten million (1 trip per device) trips to a sprint store or (20 calls in 3 years!!) dialing customer care plus it actually cost the company money (ZERO DOLLARS I DID THE ESN SWAP myself!) to do an esn swap being conservative 1000 dollars so Sprint has spent (WRONG AMOUNT) 2650 on you with a grand profit(HENCE WRONG HERE TOO) of 50 dollars over the course of four (THREE) years. Your logic states ( HAVING A PAYING ACCOUNT IS BETTER THAN NO INCOME) Sprint should try to hold on to customers like you but (“if all the customers were like you”) there would (n’t) be a (MORE SUCCESSFUL) Sprint. People like you sir are the reason all the rest of us have to pay more money.(CONFIRMS VERY MUCH A SPRINT EMPLOYEE at work here)

    In closing, you SIR, should check on your facts before insulting a CUSTOMER who has helped build SPRINT since 1997, MILLIONS have LEFT SPRINT and CONTINUE LEAVING because of people like YOU “working” for SPRINT!

    Thank You

  27. F1 says:

    CLARIFICATION:

    Regarding the “TB” statement above, it was meant as a light hearted joke,
    even if I had used my max level, that is 16.6 GB x 32 Months = 531.2 GB,
    as you might know, some Accounts use that in the span of less than a year.

    As stated before, my actual usage on DATA varies between 32 MB —> 16.6 GB
    SPRINT averages my DATA consumption @ 3.5 GB x 32 months = 112 GB

    Again, before anyone accuses me of abuse and “being the reason”…,
    I barely use 200 minutes a month, if that, I send zero Pictures/Videos,
    I send between 300–>600 Text messages, 10 Text messages costs less than ONE Cent.

    Thank You

  28. Kputty5 says:

    Regardless, people are canceling. My wife and I are canceling next month 1 phone and in sep. a 2nd one.

  29. Shaun says:

    Sprint makes money on even the smallest plans. Its with the subsidy of the devices which costs the company the money. That is if we are only talking about plans and phones.

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