Do I think Sprint would be ahead with SoftBank instead of DISH? I sure do – 300 YEARS ahead as a matter of fact.
When I was doing custom consulting the most fun I had was directing executive teams through their one, three and five year strategic planning sessions. I got to play consultant, standup comic and business partner all in one, while forcing people to think outside of their day to day paradigms. And since I was brought in as an outsider with a different point of view, it was fun as well as challenging.
That kind of planning doesn’t take place much anymore.
Not much seems to matter outside of quarter over quarter results and instant shareholder return these days. Short term matters more than long term, or at least that’s the impression most people have today.
Enter Masayoshi Son, the second-richest man in Japan, who loves being referred to as the Bill Gates of Japan. He thinks ahead. WAY ahead.
Son has a 300 year plan!
His “short term” goal is to invest in 5,000 companies by 2040. You read that right; 2040 is in his sights as the SHORT TERM vision. His management succession plan involves people who won’t even be born for three more generations!
Son’s most current target out of the 4,999 other firms he wants a piece of is Sprint.
“A person’s life is over in 50, 100 years,” Son said in 2010, as he updated a previous 300-year plan. “But a company lives on through the people it is composed of, and Softbank group has to survive even after I’m gone.”
Can a company really write a 300 year plan? Of course not.
There’s a striking difference between Son and DISH’s Ergen.
SoftBank is one of three major wireless players in Japan, but Son is clearly the personality, the leader with massive confidence and he’s seen as the foremost authority and visionary in his market.
Son was born in Japan to Korean parents. He came to school in the US at 16 to study at the University of California-Berkeley. He found his entrepreneurial skills there and then invented a multilingual translator that he sold for $450,000.
He then took that money and parlayed in into a burgeoning appetite for video games, importing bestselling Space Invaders machines from Japan and leasing them to college cafeterias here in the U.S.
If I sounded dubious last week about the DISH deal it’s because I think SoftBank is the better fit.
For one, Hesse and Son have known each other for years. They met in early 2001, if I recall, when Hesse was the big man at Terabeam Corp. – another telecom firm – and Son sat on Hesse’s Board of Directors.
So there’s a relationship already in place between those two, a good, strong one. And when dealing with the Japanese, relationships matter.
Second, SoftBank needs a presence in the United States and Kansas City is as good a place as any so the campus is almost certain to remain here. At the same time, I’d expect to see Hesse stay at the helm.
If you dig carefully dig through every press release you can find on the DISH proposal, there’s no “dish” on this topic. DISH is keeping silent on the topic of Sprint leadership and real estate. And if DISH isn’t speaking out on this, I’d assume it’s safe to bet several hundred Overland Park Sprint people would find pink slips in the inner office mail while many others would have offers to pack up and head for Denver or go home!
A good deal of the space on the Sprint campus is leased to others today as a result of the past Sprint employee shrinkage as the result of lay off after lay off. Still I’d hate to see it turn into another Corporate Woods.
Key Bank, JP Morgan and Apria Health Care are all major tenants on a Sprint campus today that was once busting at the seams with Sprint employees. Sprint has become more of a commercial real estate broker and less a primary resident.
Son is a different dude.
He’s Japanese, but a more Americanized version having gone to school here. He’s articulate, speaks his mind, negotiates like a world class poker player with ice water in his veins and is a major humanitarian all at the same time.
Japan’s had its share of disasters of late, a nuke melt down, a tsunami, what more does one country need? But Son bellied up to the bar with $125,000,000 out of his own pocket in relief for his country and his people.
He took another step and donated all of his future salary to the kids displaced from the disasters who had lost their parents and now are orphaned!
Sure, maybe it doesn’t look like much, since he’s worth $7.7 BILLION, but he’s doing good for his people in a time of great need. That’s the mark of a man I’d be willing to follow into corporate battle. And Sprint needs to fight a corporate battle on several fronts!
If it goes this way, what’s Son likely to do first? Take a look at one recent quote; “I am a speed maniac,” Son has said, adding he “cannot stand the slowness of the speed” in the United States.
Japan uses the same LTE (long term evolution technology) that we use in the States; it’s just much better and much, much faster. Its second nature for Japanese to use their phones for everything, ticket purchases for the train or plane, buying from vending machines that line the streets, watching TV – the phone rules everything they do.
So expect to see Sprint being pushed to provide those same levels of speed and quality. And expect them to get the brain trust to help them get there.
“Son has been buying up companies one after another,” said Mitsuo Shimizu, an analyst at Iwai Cosmo Securities. “He’s very bold and takes a lot of risks to make Softbank bigger.”
I would expect him to find other, complimentary acquisitions in the US that would make Sprint even stronger.
What do I think Sprint will do? Sprint and SoftBank Corp asked the FCC to go ahead with a review of their proposed SoftBank merger as soon as DISH came on the scene with their offer. DISH, on the other hand, asked for a suspension of the review.
Sprint replied that its board will evaluate the DISH offer and told the FCC it was opposed to DISH’s request to delay the SoftBank review.
“The Commission must not be distracted by DISH’s latest maneuverings,” Sprint said in a document addressed to the FCC.
Yes, the DISH offer is for substantially more money, but does that mean anything in the end? DISH is already loaded with leveraged debt in excess of’ $11.6 billion! Add that staggering debt to Sprint’s already debt-laden spreadsheet and what’s that buy you? All you’ve done is increase the risk of both firms.
I don’t think that’s the point, but it’s most certainly the outcome if it goes that direction.
Softbank comes to the table with financial strength and cash. Lots of cash. Their offer would do nothing but strengthen Sprint’s balance sheet.
Also Softbank is strong in the telecom/wireless space; DISH is a TV satellite provider wanting INTO the wireless market
My money is on Sprint/SoftBank. I’ll go with deep pockets and subject matter experts any day of the week.