Sprint-Nextel Get Chummy In Record Time

from the that-was-damn-fast... dept

It was just yesterday that people started seriously talking about a Sprint-Nextel combo, and already some are saying that a deal has been agreed to, meaning they did an amazing job keeping this whole thing secret. Of course, nothing has been announced and nothing is official yet, but it certainly sounds close. The article notes that some top folks at Verizon have probably just canceled their weekend plans to hunker down somewhere to see if it’s worth putting in a bid of their own for Sprint (though, someone might suggest they bid on Nextel themselves). There are lots of directions to go in discussing this one, but a few quick thoughts: Sprint and Nextel as a combo makes plenty of sense in a lot of ways. It gives Sprint easy access to Nextel’s higher revenue business customers, without having to steal them away by trying to out market Nextel on something like push-to-talk. Talk about how they use two different networks is a red herring, because Nextel knows that iDEN is a dead end, and were already evaluating EV-DO anyway (what Sprint is moving towards). Merging would confirm that deal and could completely knock out Flarion’s chances of being picked by Nextel as the sole provider of their next generation wireless broadband provider, something Flarion’s been trying to suggest was a done deal for ages. Of course, it’s entirely possible that Sprint/Nextel could also use Flarion in an attempt to leapfrog over other wireless broadband offerings by offering it separate from EV-DO and more targeted as a wired broadband replacement, but it certainly makes it a tougher case. In spectrum world, it also puts Sprint and Nextel in a great position, while leaving T-Mobile as the only national carrier that’s really desperate (really, really desperate) for spectrum. Of all things, this could actually be good for T-Mobile — as they’ll be the only bidder with a real need at next month’s FCC spectrum auctions, though Verizon is never shy about trying to gobble up spectrum at every opportunity. If Verizon decides not to jump into the merger fray, they may actually be better off for it. Cingular is going to spend a year or two digesting AT&T Wireless (during which time Verizon will likely catch them) and Sprint will have to work on integrating with Nextel, leaving Verizon as the carrier who has already integrated all their various pieces (remember, they were created out of a megamerger of their own) and is moving forward.

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