Sprint CEO Claure Promises 'Disruptive' Pricing and Cost Cuts
Sprint's new Bolivian Chief Executive Officer, Marcelo Claure, has already shaken things up in his first week, announcing aggressive pricing and cost cuts as a way of strengthening the No. 3 wireless carrier. It's no wonder he was chosen.
Claure said Sprint would be bringing "very disruptive" prices to the market next week during a company-wide town hall meeting Thursday. He did not provide specific details, but the strategy seems to mirror the voracity of T-Mobile's own disruptive CEO, John Legere.
"We're going to change our plans to make sure they are simple and attractive, and make sure every customer in America thinks twice about signing up to a competitor," he said, according to telecom industry website Light Reading.
On the back end of things, Claure promised to streamline Sprint's internal workings as soon as he started the job of chief executive Monday. He did not elaborate on how he would do this, but analysts agree that this will involve job cuts among Sprint's workforce of 36,000 employees.
"In the short term, our success will come from our focus on becoming extremely cost efficient and competing aggressively in the marketplace," Claure said in a memo obtained by Bloomberg. "The management team has been working closely with the board to outline the future strategy of the company."
Is it any wonder, then, that Claure was brought in? Sprint chairman and chief executive of Sprint's parent company, Japan-based SoftBank Corp.'s Masayoshi Son, has been calling for these kinds of changes for months now. The hot-headed CEO has apparently burst out in meetings with Sprint executives asking, "Are you stupid?" and compares Sprint to ancient Japanese feudal lords that wielded little influence outside their homeland.
"Sprint is a daimyo in Kansas," said Son. "That's not enough."
"We need to change Sprint's culture," Son told The Wall Street Journal after a news conference in February.
Claure's appointment as CEO comes as Sprint dropped its bid for T-Mobile due to regulatory pressure, despite having spent months building a case for consolidation. Verizon and AT&T pull in around 2.5 times the wireless revenue of Sprint and T-Mobile combined, and while T-Mobile has been gaining subscribers, Sprint has lost customers every month since 2007 under old CEO Dan Hesse. An aggressive executive who isn't afraid to shed the dead weight might be just what Sprint needs. After all, it worked for T-Mobile.
"You have probably seen the many media reports speculating about Sprint's future," Claure said. "As I have already said, consolidating makes sense in the long term but, for now, we will focus on growing and repositioning Sprint."
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