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Sprint Close to Buying Nextel

Posted by CowboyNeal on from the stack-and-attack dept.

NateDawg writes "After the recent merger of AT&T and Cingular, it looks like Sprint is close to buying out Nextel. According to CNet, the different networks could bring expensive problems, but that could be overcome by the diversity of the company's clients. Nextel has many corporate clients, while Sprint appeals to families and teens."

3 of 256 comments (clear)

  1. Misprint by Nine+Tenths+of+The+W · · Score: 5, Funny

    According to CNet, the different networks could bring expensive problems, but that could be overcome by the diversity of the company's clients.

    This sentence should read: "According to CNet, the different networks could bring expensive problems, but that could be overcome by making the customers pay through the nose"

    --
    Slashdot: News for Nerds, Stuff that matters only to them
  2. Re:wall st by Patik · · Score: 5, Funny
    the combined company, to be called "Sprint-Nextel"
    Darn, I was hoping for Sprixtel, or Nextint, or maybe Sextel.
  3. Here's how this will work. by s.o.terica · · Score: 5, Insightful
    The reason that Sprint wants Nextel is that Nextel is the network that has best been able to take advantage of the Network Effect, i.e. the effect where each node on a network is made more valuable by each additional node that is added. Nextel has Direct Connect, its walkie-talkie service that is hugely popular with businesses, and the main reason that Nextel has the lowest "churn" rate in the industry. Nextel business customers won't switch to another network because then they won't be able to Direct Connect with other Nextel phones anymore. Period.

    So, Sprint/Qualcomm came up with a competing alternative to Direct Connect called ReadyLink, but it's not anywhere near as useful as Direct Connect because there aren't nearly as many other people who have it.

    So in the short term, what Sprint is going to do is to make changes on the network side to allow Sprint phones to walkie-talkie with Nextel phones. That will effectively instantly make more valuable both Nextel's phones and Sprint's phone.

    In the longer term, Nextel is going to have to move to new spectrum that the FCC has given them due to Nextel phones interfering with emergency vehicle communication. Because of this, they will have to move customers to new phones. So since they have to move their network and swap out their customers' phones anyway, there is no reason that they wouldn't just take the opportunity to move to the significantly more efficient, flexible, and forwards-compatible CDMA 1xRTT (and soon EV-DO high-speed data) standard (that Sprint just happens to run on.

    Bingo. Now it begins to make sense, eh?