Sprint recently announced that it is considering developing a business unit to expand its Wimax consulting to companies in India. Sprint wants to make the most of the technology consulting capabilities it has gained in its attempts at new network rollouts in the US - even the less successful ones - and sell that in global markets. India is an obvious opportunity.
This would be an interesting move if Sprint was already a globally recognized consulting company and/or if it had more global resources available, but instead it is a distraction. Sprint has yet to demonstrate and introduce Wimax services in more than a few markets in the US. In addition, the Clearwire merger has just been completed and there are many other fires on the home front to address.
Sprint needs to focus on its current major services and regions in the US and get Sprint turned around and growing. It is losing subscribers and is behind the other major wireless carriers; it is also only just starting to see progress in wireless customer care. The upside potential of this consulting business is limited. It will be slow to materialize, with few sizable customers spread over many different regions. It does not make sense for Sprint to pursue this expansion unless there is a long-term plan to enter India or consultancy.
Unwelcome distractions
It is interesting, and to some disturbing, that Sprint would publicly announce its intentions to enter the global Wimax consulting business. With all its other priorities and some initial progress on the current plans led by Dan Hesse on innovation, iDEN improvements and customer service, this seems like a contradiction to its current focus and the tactical plans that are starting to produce some positive results.
Sprint-Clearwire's partners and wholesale customers may be concerned that this tangential business will divert Sprint's attention and expertise away from its new US service efforts. This is particularly concerning given Sprint's current performance in the US and its efforts to improve its iDEN network.
Sprint has the experience and technical knowledge necessary for this consulting business, and many in the industry might acknowledge its expertise in Wimax. However, this does not automatically validate a new business venture or expansion.
There is a lot of work to be done on the Clearwire deployment and service introduction, and there are likely to be some implementation and development activities that require major effort from Sprint's staff. This consulting business may send a signal that dilutes its current messaging and the focus of its turnaround plans.
If the argument is that there are just a few resources involved and/or that the projects will not be that resource-intensive, then one has to ask why Sprint would even bother with this business, unless there are long-term plans that are not public.
Not proven at home
According to recent press reports, Sprint is currently working with Indian operators including Tata Communications, Bharat Sanchar Nigam (BSNL) and Reliance Communications to develop and expand its Wimax offerings, and may also be considering bidding on Wimax spectrum itself. We feel that Sprint still needs to prove this model in the US and that Indian markets will distract Sprint's efforts, unless it really is a very small group.
The consulting opportunity may be large and lead to global expansion but the odds are that Sprint would not get sizable consulting revenues from all three India operators mentioned in the article. The scale of this opportunity has to be very small for Sprint in comparison to the other turnaround efforts and the completion of the Sprint-Clearwire merger. Sprint needs to make sure that this doesn't turn out to be another 'Pivot' (its failed joint venture with cable companies).