Sprint Cuts Jobs, Bets on Bundles

Sprint announced today it will cut 1,100 workers, a move
prompted by a steady decline in business from its long-distance service
customer base.

“Our intent is to sell packaged integrated services — local, long-distance
and wireless,” Mark Bonavia, a Sprint spokesman, told
internetnews.com. “It’s not the best time to be selling [standalone
long-distance].”

The Overland, Kan., company says the packaged offerings help them win new
customers and retain existing ones through discounts and low-hassle
billing.

On the business side, Sprint is focused on providing managed
network services, such as VoIP, to corporations and
government agencies.

The job reductions affect up to 850 Sprint Business
Solutions workers and up to 250 corporate support staffers,
including IT employees. The Kansas City area will lose about half the jobs, with the rest
being spread throughout other U.S. offices. Workers will learn by mid-July if
they will be laid off. Those who are will receive severance pay and job-search assistance.

This latest round of cuts brings Sprint’s 2004 layoff total to 5,000 and more than 24,000 positions since 2001.

Like fellow long-distance carriers AT&T and MCI, Sprint has watched
wireless offerings eat into its traditional customer base. More recently,
the company faces a challenge from Baby Bells that offer long-distance and upstart
broadband telephony players.

In response, Sprint is making network investments with convergence in mind.
It’s in the early stages of deploying Nortel softswitches to
handle VOIP, wireless, enterprise data, cable, and
local and long-distance voice traffic.

Despite the need to reduce its workforce, Sprint reaffirmed that full-year
earnings will be between 70 cents and 75 cents per share and free
cash flow will be approximately $1.8 billion.

Sprint said stronger performance in the PCS wireless division
and steady performance in the local division will offset
lower-than-expected revenues from its overseas division.

The company will release second
quarter earnings on July 22. Shares of Sprint stock were off about 2 percent
at midday.