Marketing Digressions

How Much Do You Really Make?

Want to know how much money you are making in real time - by day, minute, hour or second?  Just go to this website.  It will either make you feel real good or real bad.

Dulles-Based AOL to Cut 2,000 Jobs as Part of Restructuring

Hot off the Potomac Tech Wire: 

Dulles-Based AOL to Cut 2,000 Jobs as Part of Restructuring

Dulles, Va. -- Continuing its shift toward online advertising, Dulles-based AOL plans to cut 2,000 jobs -- or about 20% of its workforce -- a website owned by Dow Jones first reported on Monday. About 750 of the cuts will occur in Northern Virginia. Citing an internal memo from CEO Randy Falco, the All Things Digital website said that the cuts will be spread across the company's operations in the U.S. and Europe, with "some unidentified senior executives" also departing. AOL, which recently announced plans to move its headquarters from Dulles to New York, is combining its various digital advertising companies, including Advertising.com, Tacoda, Third Screen Media, Lightningcast, and AdTech, into a unit known as "Platform A." The job cuts stem from the fact that AOL is focusing more on online advertising, which is less labor intensive than dealing with custom service issues from dial-up internet clients.

http://kara.allthingsd.com/20071015/aol-layoffs-letter-from-randy-falco/ (memo)
http://biz.yahoo.com/rb/071015/aol_layoffs.html?.v=5 
http://biz.yahoo.com/ap/071015/aol_layoffs.html?.v=2

Sprint To Tap New CEO In 30 Days?

According to an article on BusinessWeek.com, "The goal is to name Forsee's successor in as little as two weeks and no later than 30 days..."  They are working with executive search firm Spencer Stuart to achieve this lofty goal.  Sprint is searching overseas to avoid nasty non-compete clauses - the very thing that made getting Forsee so difficult and expensive.  Key candidates according to sources in the article are as follows:

1. Sanjiv Ahuja, the well-regarded former CEO of European wireless carrier Orange.
2. William Morrow, a former Vodafone (VOD) turnaround executive who is now president and chief operating officer at Pacific Gas & Electric (PCG).
3. Andrew Sukawaty, a former Sprint exec and CEO of satellite player Inmarsat (ISA.L)
4. Daniel Hesse, CEO of Embarq (EQ), the local phone division recently spun out by Sprint.

According to the article, "Ahuja and Morrow had been interviewed for the Sprint COO job, which Forsee and the board had been looking to fill for more than a year. For that position, sources say Sprint also considered or approached telecom execs such as former BellSouth President and COO Mark Feidler and William Hannigan, No. 2 at AT&T (T) before it was acquired by SBC Communications. Noncompete clauses in both executives' contracts raised red flags."

So, lets pause and ask some questions. 

First, what value do overseas players such as Sanjiv Ahuja bring to the table to the only wireless giant in the US that does not use GSM and is NOT global?  Well, he is the person who led IBM into the telecommunications software industry.  He joined Orange in 2003 and doubled its subscribers from 48 million to 100 million.  But, he relinquished his executive roles at Orange in April of 2007 - some say at critical time for Orange.  Many questioned why he was replaced by an industry outsider Olaf Swantee - an SVP from HP.  On the other hand, why would he come to the US to take on such a nasty situation as Sprint Nextel?  It will take some serious money and equity to make that work.

Second, is Morrow the right guy to take charge of a company needing a bolster of growth and out of the box thinking?  Pacific Gas & Electric is far from an innovative company.  While it is great that he is a turn around expert, Sprint needs more than just that.  They need a visionary and a passionate leader.  I don't know if he is, but I would be surprised if a passionate visionary would go to PG&E.  But then again, PG&E is about as bureaucratic and set in its ways - and that may prepare him to do battle at Sprint Nextel.

Third, why bring back Daniel Hesse?  He is at Embarq now - considered to be the oldest and most inflexible and undynamic part of the old Sprint (spun off at merger).  I can tell you that there are three groups in Sprint Nextel - Old land line operations, Sprint wireless, and Nextel - and there is tons of baggage and hatred between each. 

Also, land line based telelcom is about as exciting as a baked potato.  Sprint needs more than a baked potato.  Hesse's previous wireless background consists of Terabeam (a leader in core-to-client solutions for broadband municipal wireless networks - this is NOT an area sprint needs to get into) and AT&T wireless back in 97' to 00' (that is like a billion years ago in technology and its NOT the AT&T of today that is merged with Cingular).   I am sure he is a heck of a smart guy, just not the right guy.

Fourth, can you really negotiate well to acquire a good leader at a fair financial price if you have laid down the gauntlet and damned the torpedoes to get someone in place within 30 days?  I think not.  Sprint Nextel is showing why it struggles in the first place - poor decision making. 

But, out of the cast of characters above, I would only vote for Sanjiv.  He seems quite impressive to me.   

Inphonic Defaults On Loans - Bankruptcy Ahead?

This just came in from the Potomac Tech Wire:  Washington, DC -- In an ominous filing for a company that was once one of the region’s brightest stars, DC-based InPhonic, the online wireless device and service retailer, revealed on Friday that it has defaulted on interest payments that were due on Oct. 1. The latest move reveals the extent of the financial difficulties facing InPhonic and prompts more speculation about the possibility of a bankruptcy filing. “The lenders reserve their right to exercise any and all available rights and remedies available under the credit agreement,” the company said in the SEC filing. The company’s stock dropped an additional 17% in late day trading on Friday, after falling 60% on Thursday....

http://biz.yahoo.com/e/071012/inpc8-k.html

Uh oh.....this one does not sound good at all folks. 

Forsee Steps Down As Chairman, CEO of Sprint Nextel

Well, I was 50% right.  He stepped down.....just did not think Saleh would get the nod.

Forsee Steps Down As Chairman, CEO of Sprint Nextel

–James Hance, Jr. to serve as acting chairman; Paul Saleh named acting CEO

–Company conducting outside search for new CEO

–Company updates 2007 financial guidance

Gary Forsee To Resign On Monday?

A little birdie told me that the rumor on the Sprint campus is that Gary Forsee is set to resign on Monday.  That could leave a serious power vacuum if it indeed happens - because the other word on the street is that they are nowhere close to having a successor picked from the outside.

If they have to put an interim CEO in place, who would it be? 

• Paul Saleh - current CFO?  While he is the one real bright spot in the C-suite, I would say no.  CFO's are too limited on the operations because this is not a financial company. 
• Tim Kelly - the CMO?  Not a chance.  I am still in shock he got that job when Schweitzer left.  He is in over his head. 
• My bet is on Mark Angelino - current President of Sales & Distribution.  Before Nextel (pre-merger) he was the VP of Organizational Transformation at IBM under Gerstner.  Place your bets folks.  This could get fun.

Disney MVNO to Cease Operations

My predictions have been validated.  Disney has announced it will cease its MVNO operations.  For all of you keeping score, here is what I said:

On June 6th I predicted a massive collapse in the MVNO market within 2 years.  I also called out the following MVNO players:

"Here are a few folks that have a long road ahead of them:  ESPN Mobile and their incredibly high pricing strategy, Kajeet and their desire to go head to head with Disney Mobile (who only wants to extend the Disney brand and content), Liberty Wireless and their ability to gain new traction after their recent sale by Inphonic, and Amp'd Mobile who will go head to head with Boost and Helio for roughly the same demographic.  And this is only a fraction of the players out there right now."

Then on September 29th 2006, I reported on the death of ESPN mobile.  I then put forth my next prediction:

"Only time will tell.  Unfortunately, I suspect I will be writing about another collapse fairly soon.  My prediction?  Between Amp'd, Kajeet, Disney and Helio - I foresee two of the four going belly up in the next 18 months."

Then after I reported AMP'd bankrupty on June 5th, 2007 I stated:

I have another 4 months for one more to go, but I may be about 6 months off.  I expect to either see Disney Mobile pulling the plug and focusing on their core business moving forward, or I see Kajeet running out of cash and waiving the white Flag. 

It is now almost 4 months to the day and my prediction has become true.  Disney pulled the plug.  So, what is next?  Well, here is what I said on June 5th, 2007 to finish my post on AMP'd:

The next 6 months is critical for Kajeet.  They are hiring outside sales staff now and have put some heavy advertising spend forward in recent months.  I hope I am wrong, but recent events are not encouraging.  The iPhone release will only make it tougher for folks like Helio, Boost and Amp'd.

I just don't think Kajeet can make it much longer.  But, maybe Disney getting out can give them a few more cycles of life.  Who knows?  But I am not confident of anything when it comes to MVNO's.

Amp'd Shutting Down and Selling Assets

The information below was just passed on to me regarding Amp'd.  In short, they will suspend all U.S. operations as of July 24th. 

According to an FAQ page posted on its website, Amp'd Mobile will suspend U.S. operations July 24. The embattled MVNO alerted subscribers to the shutdown via text message over the weekend, urging consumers wishing to port their Amp'd phone number to a rival carrier to do so by the end of business today. No early termination fee will apply, although prepaid subscribers due an outstanding unpaid credit, rebate or refund will need to file a claim "to be considered for payment." According to the FAQ, Amp'd "is currently in discussions with several parties" exploring a potential acquisition.

On Friday, Amp'd filed with the U.S. Bankruptcy Court for the District of Delaware to begin auctioning off its remaining assets. According to the filing, Amp'd has exhausted options to secure debtor-in-possession financing, and is seeking to sell assets in order to defray a portion of its mounting debt. Amp'd is petitioning for a July 30 auction date. Secured lender Kings Road Investment will now participate in the auction process.

For more on the Amp'd Mobile shutdown:
- read this Yahoo! Tech article

VIOP Company SunRocket Closes Doors

As of today, any and all last-ditch efforts to keep operations running - as well as a potential sale of SunRocket - have failed.  They ceased operations at COB today.  Sherwood Partners out of Palo Alto will handle the completion all invoices, current and outstanding.  They are officially bankrupt.

SunRocket had raised between $75 to $100 million over the past few years but could not create a cash flow positive business model that would work.  Just one year ago they were ranked one of the hottest venture capital plays in the Washington, DC / Northern Virginia market.  They had signed deals with Best Buy, and had built a large outsourced telesales operation. 

On a personal note, I knew some good folks there.  It is unfortunate that they fell victim to a bad business model.  I think Vonage is not that far behind.  I personally think that VOIP has a better future in the B2B space when it comes to private ventures.  For consumers, it will be a battle between the larger cable players and possibly private label solutions from a large retailer such as Best Buy.  Yes, I said private label.  Keep your eyes open.....

5 Patterns of An Extraordinary Career

Jim Citrin and Rick Smith have crafted a book about the 5 Patterns of Extraordinary Careers.  They have a very cool little exam you can take on line that will tell you where you stand versus the tendencies of those who have generated an extraordinary career for themselves.  Here are the basics, in their own words:

The 5 Patterns of Extraordinary Careers reveals the subtle yet powerful factors that determine career success: why some people ascend to the top and prosper, while others equally talented never reach their expectations.

The idea that there are patterns in extraordinary careers is not conventional wisdom. Many believe that success is the result of either luck or larceny.

It turns out that extraordinary careers follow a strikingly consistent trajectory, marked by five distinct patterns that distinguish the very top from the rest of the pack.

So what are the five patterns of extraordinary careers? They are as follows:

1. Understand the Value of You
People with extraordinary careers understand how value is created in the workplace, and translate that knowledge into action, building their personal value over each phase of their careers.

2. Practice Benevolent Leadership 
People with extraordinary careers do not claw their way to the top, they are carried there.

3. Overcome the Permission Paradox
People with extraordinary careers overcome one of the great Catch-22s of business: you can't get the job without experience and you can't get the experience without the job.

4. Differentiate Using the 20/80 Principle of Performance
People with extraordinary careers do their defined jobs exceptionally well but don't stop there. They storm past pre-determined objectives to create breakthrough ideas and deliver unexpected impact.

5. Find the Right Fit (Strengths, Passions & People)
People with extraordinary careers make decisions with the long-term in mind.  They willfully migrate towards positions that fit their natural strengths and passions and where they can work with people they like and respect.