The Truth Behind Cricket Wireless Layoffs....

So a little investigating does a mind good! I have had MANY unanswered questions regarding Cricket's recent mass layoff across the nation. Cricket is a privately owned company under the Leap Wireless brand. Headquartered in San Diego, CA and also in Denver, Colorado, Cricket recently closed 30 stores, transitioning about 10 of those stores into premier dealers. Cricket also laid off a total of 180 employees nationwide.
While this may not be a shock to many, given the current economical situation, I have stop and ask myself, if Cricket is rapidly growing and expanding and we were constantly celebrating our quarterly numbers, what gives? Well, as said above, a little investigating does a mind good!
Here is what I found....

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Leap Wireless Closes Cricket Stores, Cuts 180 Employees
By: Bradley Fikes — March 11th, 2010Reports Xconomy’s Bruce V. Bigelow
Amid considerable speculation about a potential merger, San Diego’s Leap Wireless (NASDAQ: LEAP) has trimmed about 4 percent of its workforce and closed or transferred 38 of its Cricket Communications storefronts.
Leap spokesman Greg Lund confirms that the flat-rate wireless service provider laid off a total of 180 employees nationwide on March 1 as part of a cost-cutting review, which the company did not announce. The cutbacks occurred after Leap reported its fourth-quarter and 2009 financial results on Feb. 25 . The company posted a bigger-than-expected loss of $64 million, or 82 cents a share, for the fourth quarter, on revenue of $547 million.
The 12-year-old company has been the subject of merger rumors since reports surfaced in January that Leap had hired Goldman Sachs as a strategic adviser in a possible sale of the business. Kansas City-based Sprint and Dallas-based MetroPCS are two companies most frequently mentioned as potential buyout partners. MetroPCS made an unsolicited bid in 2007 for Leap, but a deal never materialized.


Check it out!
http://www.nctimes.com/app/blogs/wp/?p=8097
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Leap Wireless Seeks a Buyer
BY JEFFREY MCCRACKEN AND NIRAJ SHETH
Cellular provider Leap Wireless International Inc. has hired advisers and formed a special board committee to look into selling the company or merging with rivals, several people familiar with the matter said.

Leap, which sells its service under the Cricket brand and has about 4.7 million customers, has hired Goldman Sachs Group to advise the company as it "reassesses its alternatives and checks its options out there right now," according to one person familiar with the process.

Check it out!http://online.wsj.com/article/SB10001424052748704107204575039540686432982.html#articleTabs%3Darticle
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Leap Wireless: No Easy Sell
Leap Wireless has hired Goldman Sachs and asked its board members to consider selling the company, according to The Wall Street Journal. Leap's shares jumped 13.1% today, to $14.92, amidst investor hopes of a quick deal.

Check it out!http://www.wopular.com/leap-wireless-no-easy-sell
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Is Leap Wireless For Sale?

The Wall Street Journal reported today that Leap Wireless Leapis organizing a group of strategic advisers and board members as a first step in readying the company for a sale or merger. Leap Wireless (LEAP) closed at +$1.73, a number received by analysts as good news for the low cost provider of wireless services that are sold to consumers under the Cricket brand. Goldman Sachs will be facilitating the future plans of the company.

Many in the financial markets suspect that MetroPCS, another low cost wireless provider that also focuses on the pre-paid market, will prove to be the most likely partner for Leap and have been suggesting a Leap-MetroPCS merger for several months. However, recent moves by the Tier 1 carriers to lower prices to attract the value-oriented consumer during tough economic times may potentially enable Leap to court a different suitor.

Although both Leap and MetroPCS saw a lot of growth early in 2009 through prepaid subscribers—as did Deutsche Telekom owned T-Mobile US—the new customers tended to be credit-challenged, pay-as-you-go users, known as "sub-prime." These consumers tend to migrate to the lowest price, and show less loyalty to a device or carrier. With lower operating costs than most major carriers, Leap and MetroPCS have been able to stay focused on keeping their pricing competitive. However, with the impending popularity of mobile broadband Leap no doubt needs a 4G network strategy, especially as mobile broadband device prices decline and penetrate carriers' portfolios.
Leap's network was never the value proposition for its users, who were primarily based in densely populated urban areas. Unlike AT&T''s highly mobile road warriors and enterprise customers or Verizon's post-paid families, Leap's customers are less likely to notice gaps in their coverage maps because prepaid users often are young and or have a lower income. Upgrading and expanding that network, though may pose the biggest complication for a major carrier interested in purchasing the scrappy prepaid provider.
For a while, companies like Disney, Amp'd, Helio, and Virgin tried to attract young, no-contract customers with a combination of prepaid plans, other people's networks, and youthful branding. But the mobile virtual network operator (MVNO) model did not enable any of those companies to remain as standalone businesses, with Disney, Amp'd, and Helio folding and Virgin selling to Sprint.
Nonetheless, it's possible that the dark horse to purchase Leap might come from outside the wireless industry. With the introduction of branded mobile services and growing sales from mobile devices, wireless retailer Best Buy could be considered a viable candidate to buy Leap. In addition, the newly re-branded Radio Shack, now called The Shack, has also made some strong moves in the wireless arena lately and has been a popular seller of pre-paid wireless products due to its strong base of value shoppers.
Check it out!
http://technorati.com/business/article/is-leap-wireless-for-sale/page-1/
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Now a quick Google search on "Leap Wireless for Sale" brought up over 100,000 pages containing this phrase. After going through the first 20 pages of links, it appears to me that Cricket is trying to find a buyer to sale off its shares and merge as one company with.....drum roll please....either Verizon or AT&T, at least that is what is sighted in many of the links Google provided.
I am now glad that when our store closed, I decided to work for the dealer and NOT continue with Cricket Communications. Very interesting stuff.
*(Not to my friends who still work for Cricket and for any corporate person that might read this note...every link contained in this note is public information and available to all. Nothing in this note breaks company confidentiality policies nor any binding confidentiality agreement entered into during my employment with Cricket.)*
UPDATE:

Boy news travels fast!!!! Not even an hour after my posting...I learn this information...
Sources from inside Leap Wireless have revealed that Cricket is strongly considering a merger with Metro PCS. Back in 2007, Metro offered anywhere between $4.7 billion and $5.3 billion to merge the two companies. It seems that those talks are now back on the table. Will update more when more information is made public.

Food For Thought....New Thought That Is...

”Even though you may want to move forward in your life, you may have one foot on the brakes. In order to be free, we must learn how to let go. Release the hurt. Release the fear. Refuse to entertain your old pain. The energy it takes to hang onto the past is holding you back from a new life. What is it you would let go of today?"

--Mary Manin Morrissey

Walmart Syndrome...

Have you ever been in Wal-Mart waiting in the returns line to return your item and witnessed someone throwing a massive hissy fit because they won't return their merchandise? At first they say they lost their receipt or that it was a gift, which we both now they really lost their receipt or they stole it. Wal-Mart's return policy strictly says "no returns without receipt."

Knowing this policy and trying to get around this, their minds go into what I call "Wal-Mart Syndrome". This is where knowing the policy and being told it can't be returned, they begin to yell, shout, curse and do whatever they need to do to get their return. Every time I have seen this happen, a manager is usually called over to handle the situation.

Now when the manager gets there the customer returns to their right mind and calmly explains the situation to the manager. Then the manager tells them, "I'm sorry but according to our policy we cannot return it without a receipt, but as a courtesy, we will let you return it and put it on a store credit gift card." Well, to most people doing a legitimate return are ok with this. Its the crazy "crackheads" that begin to yell, shout and curse at the manager until the manager gives in and returns it for cash, just to get the customer out of the store or to stop any scene that might be made.

This is irritating to me because I am in sales. Our return policy is clearly printed on every receipt that we give out. Our return policy is "any phone purchased can be returned with original box, receipt and all accessories (as long as the accessories haven't been opened) as long as it is within thirty days and has no more then thirty minutes of talk time." Our policy is very strict and set by corporate and we cannot override this policy. But here is where my real issue lies...

So people come in to my store wanting to return their purchase, clearly outside of the noted return policy, and then proceed to go into that "Wal-Mart Syndrome" and yell, shout and curse at me thinking they will get their way. Then they ask for the manager and well, as mentioned above, calmly tell the manager of the issue (while telling them I refused to help them, can't forget that). Once the manager says, "sorry its clearly outside of our stated return policy." They go back into the "Wal-Mart Syndrome" mindset, thinking it will work. And it never does and never will, at least where I work.

Then Wal-Mart is well known for taking back merchandise and giving out cash refunds for products they don't even carry. Are you serious? How stupid is this? If you come into my store trying to return merchandise that I know good and well you didn't buy here, your probably going to be laughed at, no seriously. Wal-Mart is setting standards that are ridiculous and are allowing stores to practice things that are effecting other retailers.

Now I know Wal-Mart is large enough that they can afford to return merchandise from Target or K-Mart, but not every retailer can afford that. Customers are realizing this and trying these same tricks at other retail establishments thinking it will allow them to get what they want. I honestly think "Wal-Mart Syndrome" is a psychological disorder that should be checked out by a licensed clinical psychiatrist and medication should be prescribed to the customer. This sure would make my life easier.

Victor