August 6th, 2008
Time for Google to take out Sprint
If we are to see real competition, in wireless or broadband, it’s time for Google to take out Sprint.
Since making its deal with Sprint and Clearwire to deliver WiMax nationwide last year, Google has been very quiet in the wireless services area.
Meanwhile, Sprint Nextel has continued to fade, losing another $344 million last quarter, announcing plans to sell $3 billion in preferred stock. It has proven a bad investment for the institutions which own over 90% of the common.
While tests and deployment of WiMax are moving ahead, no one trusts the Sprint brand (and with good reason — I’m a dissatisfied customer). It actually lost 901,000 customers last quarter.
The answer is simple. Buy the preferred, becoming Sprint’s largest shareholder. Then, with institutional support, change the brand name to Google Wireless. Or Google Clearwire.
Customers will immediately give the company a second chance. Google gets a large retail network for pushing Android phones and WiMax cards, as well as Google swag and the Google brand.
As the WiMax services come on-stream, it puts pressure on shares of Verizon and AT&T, forcing them to maintain network neutrality to retain market share.
AT&T is well aware of the threat, which is why it has spent the last year before the FCC, trying to delay the Sprint-Clearwire transaction.
Putting Google’s name forward would not add further delays, in my view, it would actually accelerate the deal’s acceptance by focusing public attention on it.
So why not? For little more than twice what it paid for YouTube, Google can be a player in both wireless and broadband. Its market presence would do more to assure network neutrality than all the FCC-Comcast hearings in the world.
Dana Blankenhorn has been a business journalist for 30 years, a tech freelancer since 1983. You can follow Dana on Twitter. See his full profile and disclosure of his industry affiliations.
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| 08/06/08
