Embarq To Scrap Sprint Resale Deal When your spinoff just doesn't love you any more... According to the Wall Street Journal, Embarq will be dropping its wireless resale relationship with Sprint starting next year. That's the second such announcement in as many weeks; Qwest recently announcing they were also dumping their relationship with Sprint in favor for a new one with Verizon. When Embarq was spun off from Sprint in 2006, the company thought they'd sell a million wireless accounts, but instead had just 112,000 wireless customers at the end of last year. Sprint lost more than a million customers in the first three months of this year due largely to poor post-Nextel merger customer support. In January, the company announced they'd be laying off 4,000 employees and closing 125 (8%) of their company-owned retail locations. When your spinoffs don't even love you, what's a wireless company to do?
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  DaveDudeNo Fear
join:1999-09-01
New Jersey
kudos:1 | Titantic Wireless Sprint just cant stop the sinking. First it was customer defections to other carriers, then it was nextel re-banding deadline, and now it own child-company ending the relationship. | |
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| | It was a merger made in hell.... I never understood why they merged in the first place. And then, to make matters worse, after they merger to they spun off Embarq. It would have made more sense to keep the local/long distance service cash cow for rough times like these. You can always count on those revenues coming in no matter what. Now what do they have? | |
| | | | Re: It was a merger made in hell.... I believe that was a requirement of the merger, I think they were forced to split off Embarq. If they could have, I'm sure they would have kept it. | |
| | | | | Re: It was a merger made in hell.... I don't think that the spin-off was a requirement per say, but it did give a nice tax shelter. That plus the differing point of views from Sprint local and Sprint PCS led to the split.
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DSLr Mafia Member. | |
| | | |  old_dawg"I Know Noting..."
join:2001-09-22
Westminster, MD
 ·Comcast
| Re: It was a merger made in hell.... said by Dezbend:I don't think that the spin-off was a requirement per say, but it did give a nice tax shelter. That plus the differing point of views from Sprint local and Sprint PCS led to the split. And you are qualified to speak on this divestiture how ?,
and the phrase is "per se" nimrod. 
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"Our network engineers are aware of the problem..." | |
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| | Cable This is a direct response to Sprint working so much with cable now.
Is it a coincidence that Qwest and Embarq, both telcos have decided to pursue other avenues... no | |
| | | | Re: Cable Actually it is not. The churn on the re-branded wireless service was so high that it just wasn't a benefit to Embarq to keep it as a strategic product. Embarq was losing far more than it was gaining on the product. Eventually the credit criteria for qualifying for the service was so high that no one who wanted it could qualify, and those who could qualify didn't want it. | |
| | | | | Re: Cable If you've ever seen Embarq's pricing, it's no wonder it failed....anyone who did a little research would quickly realize "why go with Embarq, when I can go with Sprint?"
Granted, probably not everyone did this, but Embarq's wireless pricing structure wasn't that great, at all.
Personally, I'm glad this happened--it means Embarq can sink more money into their DSL services (and replacing crappy lines).
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"True Patriotism is more closely linked with dissent than it is to conformity and a blind desire for safety and security...I accept the definition of patriotism as that effort to resist abusive state power." -Ron Paul | |
| | | | | | Re: Cable Actually, I work for Embarq, so I saw the pricing every day for as long as they had it. The recent pricing before the decision to drop the service was actually pretty comparable with most of the providers out there, and the deposits and overage charges were lower than sprint's, with more anytime minutes given and more flexibility with plan changes.
The major detractor of the service was a lack of Nights & Weekends at launch, high costs for additional handsets, and the fact that much of Embarq's footprint for local service actually can't get good coverage on the Sprint network. These things resulted in billing issues, a lower number of accounts with multiple handsets (single users are more likely to churn than families), and a general dissatisfaction with the quality of the service. All of these things breed churn, and while an effort was made to fix these things, it was just too little, too late by then. | |
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| | This is different... Than what Qwest did. Qwest decided to strike an agreement with Verizon to provide wireless to their customers going forward. Embarq is getting away from wireless altogether. No deals with VZW, AT&T, T-Mo, etc. Most likely they'll try to transfer their existing 112K customers directly to Sprint and that will be that. No real loss here for Sprint. | |
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