Morning Brief: Sprint Nextel Cuts Herndon Jobs

Troubles continue to mount at Sprint Nextel. The telecommunications giant said Thursday it will lay off 160 employees from its Herndon operations. The announcement comes amid questions about the success of the company's high-speed Internet technology venture with Clearwire.

The layoffs will come from staff at Sprint's building that operates laboratories and offices for its former WiMax brand Xohm. Xohm merged with Clearwire of Kirkland, Wash., in November in a $12 billion deal that involved investments from Google, Intel and cable operators Comcast, Time Warner and Bright House. Staff writer Cecilia Kang has the full story here.

In news from another troubled local company, Circuit City of Richmond said on Friday morning that the company is "engaged in significant discussions, meetings and negotiations with two highly motivated and interested parties concerning the terms of a going concern transaction."

Circuit City, which is undergoing bankruptcy proceedings, said the interested parties are considering providing additional money to keep the company running "to allow the company to sustain operations and move forward with a subsequent restructuring through a stand-alone plan and/or purchasing the company or all or substantially all of the company's assets."

Circuit City did not say who the suitors were.

In inauguration news, the swearing in of Barack Obama has turned out to not be the fast-money payday that many with homes for rent across the Washington region had hoped it to be. As staff reporter David Nakamura reports today: "The inaugural housing market has gone bust in record time."

Nakamura finds that people who listed their properties within a week or two of Obama's Nov. 4 election victory were able to score deals, but those who came on later have largely been left without offers.

Tim Tate, for example, hatched a plan to rent out units and use the profits for a week-long jaunt to Morocco. But nearly two months after listing his condo on an inaugural housing Web site (one bedroom, one bath, $2,000 for the week), Tate has gotten nary a nibble. Neither have his friends. He dropped the price twice. The only inquiry came from European parents who wanted to rent it for their daughter's semester in the District.

"We all started to list, and then the silence ensued," Tate told Nakamura.

In Metro news, the area transportation system faces a 13 percent shortfall in its $1.3 billion operating budget for next year. And officials have suggested cutting almost 900 positions and enacting the largest-ever cuts in train, bus and paratransit service, even as transit ridership in the region and across the country is soaring.

The gap of $176 million is the largest in the agency's 33-year history. Unless board members and agency officials are able to make significant additional expense cuts or discover new revenue to plug the hole, riders could be facing $73 million in service reductions starting in July, officials told staff writer Lena Sun. They did not specify what might be cut.

In other District news, the federal government won approval Thursday to build a massive headquarters for the Department of Homeland Security on a 176-acre hilltop site east of the Anacostia River.

The $3.4 billion headquarters would be one of the largest construction projects in the Washington area since the Pentagon was built in the 1940s. Advocates say it would generate economic activity in one of the city's poorer corners and provide a secure workplace for 14,000 Homeland Security employees scattered across the Washington area.

Historical preservationists have said the project would ruin a national landmark site with panoramic views of the District, where the first federal psychiatric institution was established in Southeast Washington in 1852.

By Alejandro Lazo  |  January 9, 2009; 9:06 AM ET  | Category:  Economy Watch , Morning Brief , Sprint
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