Feb. 14 - Sprint recently finalized its decision to relocate its headquarters from Reston, Virginia to Overland Park, Kansas. The company has wrestled back and forth with two main operations centers since the merger between Sprint and Nextel in 2006. CEO Dan Hessee also announced plans to cut 4,000 jobs in the Washington area. Former Nextel executive Daniel Ackerson said it this deals a “blow” to the technology region, in the wake of AOL’s recent relocation of headquarters to New York. The Washington Post detailed a report about the announcement here.
More than a blow to the region, Sprint’s announcement seems more like a blow to its own reputation in the wireless telecommunications field. When people think technology, they think California, Seattle, New York, and Northern Virginia. Secondary markets like Montgomery County, Maryland may see small spurts of growth. Kansas, however, is a step in the wrong direction for Sprint. Image means quite a lot in the fast-paced telecom world. Company executives should take care that drastic steps don’t send the wrong message.
Sprint’s merger with Nextel brought the challenge of combining two business juggernauts into one seamless operation. Additionally, Sprint had the perfect opportunity to move away from the old mindset (think of Murphy Brown commercial for ten cents a minute long distance or the mid-nineties PCS system). Sprint could grab on to Nextel’s surge in subscriber base (largely resulting from the NASCAR Nextel Cup Series), adopt the innovative appeal of Nextel’s network, and move forward as a company. Additionally, they had the opportunity to relocate to an area more associated with high technology.
Mr. Hessee’s announcement demonstrates the company’s desire to appeal traditional ways, revert back, and Sprint away from the future and towards the past, rather than “Sprint ahead.” Hessee seeks to bring the two cultures together by uprooting the newer, more progressive Nextel from its home and transplanting it in the middle of a flyover state. Granted, neither party wanted to relocate. When reconciling all of the company’s interests, however, it seems like the more realistic option would be to a place closer to the action, closer to the Federal Communications Commission, and closer to the future. With projects such as Fourth Generation Wi-Max launching in Washington, DC, it seemed inevitable that the company would remain close to its initial market.
Sprint is an innovative company and undoubtedly has a lot of tricks ready for the unveiling. This decision simply seems out of place and leaves local technology experts scratching their heads trying to understand the reasoning.
(In the interest of transparency, the chritic has family that Sprint employs. That family member had no contribution to this piece.)
