Customer Service Still A Problem For Sprint

Sprint-Nextel (NYSE: S) is in the midst of rolling out its next-generation 4G WiMax service which it hopes will give it advantages over larger rivals AT&T Wireless and Verizon Wireless. Sprint’s problem in gaining market share may be that its customer service is still sub-par.Zogby and MSN have released their new report on customer satisfaction. “To gauge these sentiments, MSN Money identified 150 of the largest companies in 15 customer-facing industries, as varied as fast-food chains, airlines, grocers and financial-services companies,” they said.

It should be anticipated that cable companies and banks which rely on millions of consumer transactions per day would do poorly. And that was true. The list of the 10 worst companies included AOL (NYSE: AOL), which has a large ISP, Bank of America (NYSE: BAC), Comcast (NASDAQ: CMCSA), Dish Network (NASDAQ: DISH), Wells Fargo (NYSE: WFC), Citibank (NYSE:C), and HSBC.

Among large telecom companies with either landlines or cellular services, Sprint was the only firm on the list. That is likely to make it hard to promote its 4G products which are the company’s future. Without adoption of its WiMax technology, Sprint will continue to lose customers and with them, its case for viability. There have already been rumors that T-Mobile might be interested in taking Sprint over, at a very low price. The market already realizes that. Sprint trades for under $5, down from $25 four years ago.

Sprint needed to repair its image with consumers before it rolled out its new products. That did not happen.

Douglas A. McIntyre