When it comes to content, Sprint Nextel has had some spectacular deals. It owns the mobile rights to the NFL, and for as long anyone can remember, Nextel has been synonymous with Nascar. But the third-largest carrier’s commitment to content is in doubt after mocoNews learned that its product and content group is in the process of chopping roughly 500 people, or about 40 percent of the team’s 1,200 to 1,300 employees. The information was confirmed by a handful of people, who spoke to us on the condition of anonymity, and either work at Sprint or are partners with Sprint (NYSE: S). A spokesman said the company is still in the process of notifying employees, so it cannot confirm any details at this time.
The layoffs are part of a massive restructuring that the struggling carrier announced in January. Sprint plans to eliminate 8,000 jobs by March 31 in order to save $1.2 billion annually. The cuts are expected to affect all divisions, all ranks and all geographies, except for any customer-facing positions. In the case of the product team, it seems to be getting its fair share, but no more, since several divisions are expected to be trimmed by about 40 percent, according to multiple sources. Two sources added that the product cuts will hit Sprint’s CDMA network, more than Nextel’s iDen network. The spokesman said the cuts will vary across groups.
The larger question is: what will Sprint’s role in content be going forward? Perhaps, on some level Sprint absolutely had to make the cuts because of falling subscriber figures. At the same time, however, it does not appear that Sprint was willing to take any Herculean efforts to save the division — despite the fact that content is seen as a way for carriers to differentiate themselves; sell more data plans; and prevent becoming a dumb pipe. Sprint spokesman James Fisher said Sprint remains committed to content. “We offer a vibrant and competitive product so customers can get the most out of their data services. While we may make some changes in different parts of the company, customers will continue to have a very robust experience when they are using our handsets.”