WT Business Beat

By Nick Wakeman

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Nick Wakeman

Don't count Sprint out of federal market

Over the last few months, I’ve heard a lot of rumors about Sprint and the supposed demise of its federal business.

Earlier this month, the company announced that it would lay off 2,000 employees and during an earnings call, the new CEO Marcelo Claure said, “We are looking at the business end-to-end. Every dollar spent is big closely scrutinized.”

In response to a question during the same conference call, Claure also said that the company would even consider selling its wireline business.

Putting rumors to the side, the question to me is what do these actions mean to Sprint’s federal business. The company ranked No. 63 this year on the Top 100 with $293.6 million in prime contracts. It is one of the primes on the GSA Networx Enterprise contract. It also holds a GSA Federal Strategic Sourcing Initiative Wireless Blanket Purchase Agreement.

In other words, their federal business is not inconsequential.

Going through the official Sprint channels, however, didn’t bring a detailed response.

Via email, a spokesman said, “Like all businesses, as a standard practice, we regularly evaluate all offerings and lines of business. In this instance, we have a new CEO that has in place for 85 days (as of the earnings day) and he’s asked for a strategic review on all Sprint’s business operations.”

In response to my questions about the rumors, he said, “We cannot comment on rumor, speculation, or active bids and contracts.”

From other sources I get the sense that Sprint is definitely going through a transition, but that doesn’t mean it’s abandoning the market.

It still has a sales force out beating the bushes for business, a source told me.

Sprint also is apparently very active with the ACT-IAC working group on the NS2020, the follow-on contract to Networx. The implication is that if they were backing away, they wouldn’t be making the investment to be part of NS2020.

Even if Sprint leadership decides to sell its wireline business, it is still a strong wireless player and could capture a spot as a prime on NS2020 with that capability depending on how the contract is structured.

If the wireline business is sold, Sprint also could partner with another company – particularly one without the wireless capabilities – to offer a broader solution.

My sense is that Sprint isn’t going anywhere, but as it goes through this review and transition under its new CEO, the rumors of its departure from the federal market will continue to flourish.

Posted by Nick Wakeman on Nov 17, 2014 at 9:23 AM

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