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Embarq exec vows innovation

Dan Hesse

 

By RODGER NICHOLS
The Dalles Chronicle

August 5, 2006

Look for more innovation and better service from your local phone company.

That was the underlying message from Embarq CEO Dan Hesse, who was in Hood River Monday for a series of meetings with employees and local community leaders.

Embarq is the local phone company in most of the Mid-Columbia — and in portions of 17 other states — since it was spun off in May from Sprint Nextel.

Sprint kept the wireless and long distance business, while Embarq received all of Sprint’s land-line holdings in the U.S.

In Oregon, Embarq territory includes a stretch of the northern coast, a section around Crater Lake, and a large territory that sits astride the Columbia, stretching roughly from Cascade Locks to Arlington and from Grass Valley to Goldendale.

“Sprint was a 50-state company,” Hesse told community leaders at a lunch meeting Wednesday in Hood River. “It was focused primarily on the major markets — New York, Chicago, Los Angeles — as a national wireless and national long-distance company”.

Embarq, he said, operates in only five percent of the United States, but is a significant player in those communities.

Nationwide, the company has 20,000 employees in 18 states.

About one percent of that workforce — 200 employees — work in the Mid-Columbia. About 150 are based at the Waucoma Center in Hood River; 18 work in The Dalles, and the rest fill positions in White Salmon, Goldendale, Arlington and elsewhere.

When Embarq was created in June, one of the new company’s very first announcements was that there were no layoffs planned.

That was deliberate, Hesse said. Rather than let people go, the new company preferred to redirect their efforts
“A lot of the people who worked here in the Gorge were calling customers in Portland and Seattle, or other areas around here.” Hesse said. “As a result, they were spread kind of thin when customer service was the issue. No longer. A hundred percent of our attention is focused on providing local service.”

But Hesse said Embarq is aware it faces competition from cell phones and “voice over Internet protocol,” known as VOIP.

In response, Hesse said, Embarq plans to offer a suite of services, with an emphasis on integration and user-friendliness.

He cited seamless integration between wireless and “wireline” technologies. He displayed his own wireless phone, which he said links to the land-line phone in his office through Wi-Fi, without using up his cellular minutes. If he has to leave the office while still on the call in order to make an appointment, he can keep talking, knowing that at some point, the connection will be handed over seamlessly to the cellular network to keep him mobile. When he returns to the office, the process is reversed.

“Another innovation,” Hesse said, “is a single voice mailbox for your home phone and your cell phone. Whether they call your home phone or your cell phone, you only have one to check, and you can look at all your messages visually. So if you’ve got 10 messages, and actually number seven is the most important, you don’t have to listen to them all sequentially. You can go right to the message you want to hear first.”

Though Embarq is a land-line and not a wireless company, it will be able to offer wireless services by purchasing minutes from Sprint and using Sprint’s network of towers.

“Wireless is one of those areas we offer almost everywhere but in Hood River and the Gorge right now,” Hesse said. “Hopefully that will change soon.”

Hesse displayed his most passionate convictions when asked about taxes and fees imposed on land-line companies.

“If you make a call to New York using voice over Internet protocol from your local cable company, and a call to New York on our facilities,” Hesse said, “We will both, once the call gets to New York, use Verizon local lines. But I will write a check to Verizon 19 times higher than the cable company for using the exact same facilities -by law.”

As another example of unfair taxation, Hesse noted the federal government finally eliminated the excise tax on telephone services, a tax originally levied in 1898 to help fund the Spanish-American War.

“It was still there because it was really a luxury tax,” Hesse said. “Way back 100 years ago, it was a luxury, and it’s not anymore.”

And then there’s “net neutrality.”

Embarq and other phone companies want to be allowed to provide extra-fast connections to a Web site.

Net neutrality advocates say if some Web site operators are able to pay a fee to give traffic to and from their site a priority, it would distort the market in favor of larger and better-funded content providers and against small providers. They argue for banning such financial arrangements.

Hesse is emphatic on the subject.

“The term ‘net neutrality’ is an absurd term,” he said. “It is closing the open Internet and bringing in government regulation into the Internet that doesn’t exist today. And it’s being pushed by some very rich people who just want to be richer. That's where it’s all coming from.”

Asked to name names, Hesse cited Microsoft, Yahoo and similar companies.

“They don’t want any innovation to come from the telecom sector,” Hesse said. “They want the network to be a commodity; dumb pipes, no innovation — so that all the innovation is done by the content providers.

Hesse compared the situation to that of banning Federal Express, because it offers guaranteed overnight service for those willing to pay the price.

“That is what they want,” Hesse said. “They want it to be illegal for us to offer superior service to anyone who’s willing to pay a premium, and they say we’ll stop offering service to everyone else.

“They have no basis for that whatsoever. It’s just nothing but scare tactics.”

Hesse has been cited in a number of press reports for loosening company style, compared to fairly rigid controls under Sprint.

One of his most popular changes was the implementation of “Jeans Friday.”

He estimates that “90 percent” of employees at headquarters wear jeans to work every Friday.

Asked if he was among them, Hesse responded, “Absolutely. Why do you think I made Jeans Friday? So somebody else could wear jeans?”

 

Hood River News and Columbia Gorge Press
are subsidiaries of Eagle Newspapers, Inc.
Copyright 2005 * Hood River, Oregon