Although the contract is a big win for AT&T, Qwest and Verizon,
industry analysts said, it is a devastating blow for Sprint, which
has provided services under the government's previous two major
telecom contracts, spanning two decades.
"This doesn't just mean a loss of federal business -- this will
marginalize Sprint and really narrow their scope to a niche wireless
contractor versus a broad carrier," said Warren Suss, a telecom
analyst for Suss Consulting in Jenkintown, Pa. "The fact that they
didn't make the cut here means that from a pricing and technological
point of view, they had a hard time providing services across the
Other analysts speculated that the government was wary of doing
business with Sprint, which has been losing subscribers and whose
stock has lost about 20 percent of its value, adjusted for dividends
and splits, since its 2005 merger with Nextel. William E. Kennard,
former chairman of the Federal Communications Commission, was brought
on to Sprint's board of directors after the merger, in part to help
bolster the company's federal presence. He resigned from his post
three weeks ago -- an early sign, some say, that Sprint was facing
While current GSA officials would not say why Sprint lost out, Bob
Woods, a former official at the agency who now works as a consultant,
surmised that Sprint could not meet the low prices of its
competitors. Woods estimated that Sprint could lose roughly $200
million to $250 million annually in existing government business.
Executives from Sprint plan to meet with GSA officials next week to
discuss why their contract proposal fell short, and the company will
decide afterwards whether to file a protest, spokeswoman Sukhi Sahni
said in an e-mail.
Sprint Nextel will not protest contract
Sprint Nextel Corp., the only losing bidder among four companies
vying for a government telecommunications contract worth up to $48
billion, said Friday it has decided not to protest last week's
The company met with the General Service Administration on Wednesday
for a "debriefing" on why they weren't chosen for the 10-year
"Networx Universal" contract.
Sprint, which has been supplying telecom services to the government
for the last 18 years, lost out to Verizon Communications Inc., AT&T
Inc. and Qwest Communications International Inc. for the Universal
contract. As a result, Sprint will not be able to compete for
individual agency business for the next decade.
The blow to Sprint, which had participated in providing telecom
services to the federal government for nearly 20 years, was a
crusher. The company has been leaking customers and jobs since
acquiring Nextel in 2005, and it had already announced plans to lay
off 5,000 workers this year as sales lagged. Asked why Sprint was
sent home, John Johnson of the GPA would say only, "The three
awardees best meet our needs." Sprint officials said they would press
the feds for a more detailed explanation next week before deciding
whether to protest its exclusion. [MORE]
On Mon, 9 Apr 2007 11:32:22 -0700, "Mij Adyaw" <mij@SpamBucket.com>
wrote in <WEvSh.firstname.lastname@example.org>:
>What is the reason that Sprint lost the contract? Does anyone have any
>information? Navas, do you know anything?
>"John Navas" <email@example.com> wrote in message
>> Sprint's condition looks so dismal that an all-or-nothing bet on an
>> unproven wireless technology is actually shaping up as a bright spot.
>> Tuning out the static surrounding its repeated stumbles, Sprint late
>> last month announced a major expansion of its wireless broadband
>> project. After originally targeting Chicago and Baltimore, Sprint now
>> says it will launch the so-called 4G service in 17 additional cities
>> by the end of 2008.
>> Sprint has budgeted about $2.75 billion for the effort, effectively
>> doubling down on a not-yet-standardized wireless format known as
>> mobile Worldwide Interoperability of Microwave Access, or WiMax.
>> Theoretically, the new network will soon deliver the sort of speedy
>> mobile Internet connections that people now enjoy at their desktops.
>> "WiMax is our future," says one Sprint insider who is involved with
>> the decision. "There's no margin for error. It's not like we can say
>> 'we gave it our best effort' and then move on."
>> Sprint loses out on major contract
>> Dealing a significant blow to Sprint Nextel Corp., the government
>> Thursday awarded the largest-ever federal telecommunications contract
>> -- a 10-year deal worth as much as $48 billion -- to Sprint rivals
>> AT&T, Qwest Communications and Verizon.
>> The GSA announcement was a serious loss for Sprint Nextel, analysts
>> said, because the Reston, Va.-based company has been providing
>> telecom services to the federal government for nearly 20 years.
>> This year, Sprint announced thousands of job cuts amid service
>> troubles, a dwindling customer base and difficulty assimilating
>> Nextel Communications, which it acquired in 2004. Sprint shares are
>> down about 20% from a year ago and the company is forecasting
>> near-flat operating revenue and earnings this year.
>> "It's terrible for Sprint," said technology consultant Warren Suss of
>> Jenkintown, Pa. "The federal government was Sprint's first major
>> customer since the company started."
>> GSA officials would not say why Sprint lost out.
>> Sprint Runs Out of Appeal
>> Sprint was a pure takeover target. That's why people owned it. No
>> other reason. There was no earnings potential, none as the company
>> pretty much telegraphed. You could bank on a disappointment, but
>> people couldn't resist it. They believed that no matter how bad it
>> was, they could withstand the pain because of the buyout potential.
>> Of course, as with the Gap, as with Home Depot, when you speculate on
>> this nonsense you have a really terrible risk/reward. Sure, Sprint
>> could get a takeover bid, but it won't come from $20. It might not
>> even come from $17.
>> Fifteen feels more like it.
>> Nobody can resist speculating on crummy companies. I just have to
>> warn you that any potential buyers of this company know that things
>> are crummy there and they aren't interested, either.
>> The fundamentals of any company must be good enough that you will
>> want to buy more if there is a disappointment. It's pretty clear
>> today that Sprint owners want out. That's what you get when you make
>> a bet on unsound merchandise.
>> Caveat emptor.
>> Best regards, SEE THE FAQ FOR CINGULAR WIRELESS AT
>> John Navas <http://en.wikibooks.org/wiki/Cingular_Wireless_FAQ>
Best regards, SEE THE FAQ FOR CINGULAR WIRELESS AT
John Navas <http://en.wikibooks.org/wiki/Cingular_Wireless_FAQ>