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Sprint CEO Dan Hesse has the right tools to fix the company

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Dan Hesse is the right person for the job at Sprint Nextel (NYSE: S). In addition to the new CEO reassuring the market that he means business by announcing more than a few thousand layoffs, Hesse has the skills to understand why the Sprint-Nextel merger was never really completed and take steps to finalize it into one single company, almost three years after the merger officially took place.

Sprint has lost hundreds of thousands of customers in many recent quarters due to the company not giving enough attention to its Nextel radio network. The thinking back in 2005 was that combining Sprint and Nextel into one company would give the single entity a huge customer count and put it on par with other wireless giants like AT&T (NYSE: T) and Verizon Communications (NYSE: VZ). However, customer counts are meaningless if you jolt so many of them so badly that they head for the exit doors. That's precisely what has happened.

Here we are in January 2008, and Sprint has two headquarters -- one in Sprint's backyard of Kansas City, Missouri, and the other in Nextel's backyard of Reston, Virginia. Why on earth Sprint operates out of two geographical headquarters is a mystery, but it's symbolic of how the two companies really never merged outside of a single customer billing system (well, that's just my opinion). Sprint owns some massive assets in terms of wireless licenses around the U.S. and has a very capable and cutting-edge network. It should be doing anything but losing customers. Hopefully, Hesse can make that a reality soon. His success in Sprint spin-off Embarq is proof that he's the right person to attack Sprint's problems.

DISCLOSURE: The author holds no long or short positions in Sprint Nextel Corp. at this time.

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Last updated: July 06, 2009: 01:57 AM

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