Sprint-Nextel Wireless Talks Raise Question of Spin-Offs
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If Sprint Corp. does hook up with Nextel Communications Inc. -- or, as some observers suggest, Verizon Wireless -- the merger partners will face a multibillion dollar-strategic dilemma.
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New Sprint Nextel CEO Dan Hesse has lots of choices as he&#160;takes over the ailing mobile carrier&#160;and looks for problems to start solving.Sprint, the third-biggest wireless operator in the U.S., is&#160;losing subscribers as it keeps working through the merger of Sprint and Nextel, which occurred in 2005. On Tuesday,&#160;Sprint announced Hesse is taking over immediately for Gary Forsee, who was forced out by the company&#39;s board in October. Hesse, 54, previously led Embarq, the local wireless carrier Sprint spun off as part of the Nextel deal.Sprint needs to both distinguish itself from competitors and get its own house in order, according to mobile industry analysts.&quot;They couldn&#39;t go on without someone who&#39;s willing to set a direction,&quot; said Avi Greengart of Current Analysis. Sprint could try to compete with Verizon Wireless and AT&amp;T Wireless on price, or with more flexible terms of service, or bring out more innovative devices, but it&#39;s failed so far to choose, according to Greengart.&quot;Their brand right now doesn&#39;t stand for anything,&quot; he said.One thing the Sprint name has been associated with recently is disappointing customer service. Reporting on the quarter ended Sept. 30, the company blamed accelerating customer &quot;churn&quot; to other carriers in part on longer help calls and waits for those calls. The introduction of simplified bills, expected to continue until the middle of 2008, boosted the number of those calls, the company said in a filing with the U.S. Securities and Exchange Commission. Sprint also noted new handsets at rival carriers, clearly a reference to AT&amp;T&#39;s Apple iPhone.Meanwhile, thanks to about 700,000 subscribers quitting the aging Nextel network, Sprint&#39;s subscriber base as a whole declined by a net 337,000 in the quarter. The carrier said it had about 54 million subscribers on Sept. 30.What could most set Sprint apart is also its biggest gamble, the WiMax wireless broadband network it plans to build across the U.S. at an estimated cost of US$5 billion. Though the WiMax network is likely to be in place first, set to reach 100 million people by the end of 2008, Sprint&#39;s main rivals plan to have their own high-speed data offerings using a similar technology, LTE (Long-Term Evolution). And WiMax won&#39;t fix Sprint&#39;s long-overdue need to harmonize its cellular operations, currently split between CDMA (Code Division Multiple Access) and Nextel&#39;s older iDEN technology, Greengart said.If it goes ahead with WiMax -- interim CEO Paul Saleh said this month the business might be spun off -- Sprint will have to convince skeptical investors it&#39;s making the right move, said Yankee Group&#39;s Phil Marshall. It will also need to find a way for WiMax to truly complement the cellular business, Marshall said. So far, Sprint has painted WiMax as a mobile service distinguished from its conventional voice offerings by the promise of an any-application, any-device model. A better plan would be to push WiMax as an alternative to wired broadband that&#39;s bundled with Sprint&#39;s cellular service, Marshall said.However, in the short term, Hesse just needs to get the company to run its existing businesses better, Marshall said. Cleaning up customer service would be one key move, he added. Judging from Hesse&#39;s previous performance -- he once headed AT&amp;T Wireless -- the new CEO is qualified to do this, according to Marshall.&quot;He&#39;s very pragmatic and systematic in his management style,&quot; Marshall said.&#160;
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* Sprint&#39;s strong wireless Internet service and Nextel&#39;s walkie- talkie feature popular among mobile professionals would be a competitive combination.
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Sprint&#39;s acquisition of Nextel Communications is fueling speculation of more deals to come in a telecommunications industry roiled by intense competition and rapid technological change.
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The merger deal between Sprint and Nextel, which reportedly has not been finalized, is being described as a merger of equals that would create the third largest US cellular carrier with nearly 39 million subscribers.
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Sprint and Nextel, two large US mobile companies, are discussing a possible $70bn merger, according to newspaper reports.
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Wireless operators agree to $35 billion deal to create a new company that will be called Sprint Nextel. By Mobile Pipeline News. The merged company, which the companies positioned as a merger of equals, will be called Sprint Nextel.
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A Sprint-Nextel merger could be announced soon. Will a deal be bad news for consumers and investors? NEW YORK (CNN/Money) - And then there were four?
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Sprint (FON) and Nextel (NXTL) are in discussions to merge, with an eye to creating a wireless giant that could rival Cingular and Verizon Wireless in size and scope, according to two people with direct knowledge of the talks.
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KANSAS CITY, Mo. - Verizon Communication Inc.&#39;s wireless partner on Tuesday distanced itself from discussions on a potential bid for Sprint Corp.
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Nextel Communications and Sprint are negotiating a possible merger, according to a source familiar with the discussions. It was not clear how far the talks had progressed, and
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Reports that Sprint and Nextel Communications could be hours away from announcing a merger has pushed the rumor mill into overdrive.
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Sprint Corp. and Nextel Communications Inc. may soon be expected to join their efforts in the mobile phone industry merging to create a company with 33 million customers and joined market value of about $35 billion.
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Verizon Communications Inc.&#39;s wireless partner on Tuesday distanced itself from discussions of a potential bid for Sprint Corp.
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The two companies join forces to beat out the competition. Also:  Sprint to debut services to help companies manage cell phones issued to employees & hellip;. Netflix skating on thin ice.... and more.
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The merger of Sprint Corp. and Nextel Communications, unveiled last week in a deal valued at more than $35 billion, is likely to spur deployment of broadband wireless services as three giant
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Verizon Communication Inc.'s wireless partner on Tuesday distanced itself from discussions on a potential bid for Sprint Corp.