Sprint named Daniel R. Hesse, 54, as president and CEO of the company, effective immediately, the company announced today. He previously was chairman, president and CEO of Embarq Corporation. Blogrunner has more details.
“Dan Hesse is the right person to lead our company,” said board member Irvine O. Hockaday, Jr., who chaired the board’s CEO search committee. “He is a proven leader with deep wireless experience as a chief executive and an established track record of generating strong operating performance. He has the board’s full support to take decisive actions necessary to improve our performance.”
“Under his leadership, AT&T Wireless became the nation’s largest carrier at the time and grew revenues three times faster than the rate of the industry”, said James H. Hance, the company’s non-executive chairman. “The company earned awards for service and innovation, along with recognition for overall performance. At Embarq he has done an excellent job of leading the company through its inception, building its brand and delivering solid financial and operating results.”
“I am honored and excited to lead Sprint Nextel at this important time in its history,” said Hesse. “There is no company in the wireless industry with a stronger set of assets. I believe through solid execution and commitment to our customers we can reinvigorate our operating performance and return the company to a growth trajectory. We will review every aspect of our strategy as we intend to lead Sprint to the forefront of the wireless industry.”
Hesse had been chairman and CEO since Embarq’s inception in 2006. Prior to the formation of Embarq, he served as CEO of Sprint’s Local Telecommunications Division for one year before the spin-off that created Embarq. Hesse previously has spent 23 years at AT&T, including serving between 1997 and 2000 as the president and CEO of AT&T Wireless Services, which was then the United States’ largest wireless operator.
Paul Saleh, the company’s chief financial officer, served as interim CEO for the past two months. Last month, Sprint’s board reportedly turned down an $5 billion investment proposal from South Korea’s SK Telecom that would have put former Sprint Nextel Chairman Tim Donahue in the driver’s seat.
James H. Hance, the company’s non-executive chairman, will continue serving as non-executive chairman. Hance, 63, is a senior adviser to the Carlyle Group and retired vice chairman and board member of Bank of America. He has been a Sprint board member since February 2005 and was named non-executive chairman when Gary Forsee, who had been chairman, president and CEO, stepped down in October.
Sprint’s innovative WiMAX strategy was largely developed by Gary Forsee, but revenues and market share fell under his watch. The Nextel/Sprint merger also proved expensive and troublesome.
Merging the two different companies made it comparable in size to ATT/Cingular/BellSouth and Verizon but required Nextel to move many customers to new frequencies to eliminate public service interference, while making a hole at 1.9GHz. That also required Nextel to buy new microwave gear for broadcasters across the country. At least half of the company’s 12 directors worked at either Sprint or Nextel when the two boards unanimously approved the deal, observes the Wall Street Journal. Meanwhile cellular growth languished while competitors gained market share.
Forsee’s push to WiMAX was controversial. Many thought it was Sprint’s best shot at revenue growth while others thought it was an expensive science project that came at the expense of the traditional cellular model.
Hesse’s WiMAX strategy will have to appease the squeaky wheels on Sprint’s board. Some observers believe Sprint should create an independent, stand-alone WiMAX business unit. Others believe WiMAX is key to Sprint’s growth, and should remain in-house.