A FlatLiner Alert…. Sprint to Birth It?

Hesse, Sprint’s new CEO looks to being prepared to shake up the Industry. Even to the point of a flat line plan to differentiate Sprint from the competition. ThirdPipe has been saying for some time that a flat rate world was coming to cellular. Sprint just might be the one to bring flat rate mainstream.

His arsenal is packed with “nukes” - Hesse-speak for anything that has the potential to disrupt the status quo in wireless. One possibility under consideration: flat-rate pricing for unlimited voice calls.

Such a plan, if offered, could shake up the U.S. wireless industry, which has long offered “buckets” of minutes for a set price.

Hesse says he’s made no final decision about unlimited calling, but he also makes it clear that he’s going to do what it takes to differentiate Sprint from AT&T (T) and Verizon Wireless (VZ). His goal: drive customer sales through the roof.

“If we can’t be different, we can’t win,” he says flatly.

Continuing…

ncremental steps won’t stop the hemorrhaging, Hodulik says. “They need to make some fairly drastic changes.” Jan Dawson, a telecom analyst at Ovum, agrees. “Sprint can be saved, but they’re going to have to be pretty aggressive about the steps they take to fix it.”

You’ll get no argument from Hesse. Shortly after taking the helm, he set up a war room in an adjoining office. White boards were installed along with blackout shades, allowing Hesse to freely jot down his thoughts but still keep them secret, if necessary. Hesse has the only electronic key to the room, which is off-limits to everybody - including the cleaning crew - unless Hesse is present.

Giving a reporter a rare tour, Hesse draws back the curtains far enough to reveal a few category headers: “Nukes,” “Strategy” and “People” are among them.

Fallout from the brainstorming bunker is coming quickly. Hesse recently announced plans to slash 4,000 jobs and shut hundreds of underperforming retail outlets and other distribution points. Hesse also removed three top executives, including the former chief financial officer, Paul Saleh, who until recently was acting CEO.

Hesse says he’ll do what it takes to protect and promote Sprint’s unique assets, even if it means upsetting the status quo.

“We’re looking at all sorts of things that could be disruptive to the (wireless) industry,” he says matter-of-factly. Plus, he says, “I like to be on the offensive rather than the defensive.”

Lets say Sprint offers a flat rate no holds barred plan. How will the competition react? One way of course is to match. The other to discount bundles that appear to match Sprint but retain the higher income stream. But the fact is none will be able to overcome good pricing and simplicity. Two things consumers desire are not having to count minutes and a fixed pricing.

First company to adopt such a plan at a consumer favorable, company sustainable price^ will be in the cat bird seat.

Linky.

^Does not a consumer any good to have below cost pricing if the provider folds 6 months later. It has to be favorable to all three parties — consumer, company, and shareholder.