Qwest Customers to Use Sprint Network

[BillRadio]

It's a deal! from CBS Marketwatch.com:

"Last Update: 11:29 AM ET Aug 4, 2003

CHICAGO (CBS.MW) -- Qwest and Sprint said early Monday that they'd signed a wholesale agreement allowing the former to offer countrywide wireless voice and data services to business customers across the United States and to new and existing customers in a 14-state local service region.

Shares of Qwest (Q: news) climbed 18 cents, or 5 percent, to $3.97 in recent action, while Sprint (FON: news) rose 17 cents to $14.24 and Sprint PCS (PCS: news) shares were up 5 cents at $6.10.

Sprint becomes the exclusive third-party wireless-services provider to Qwest, under the terms of the deal, according to a news release. Qwest is to offer the wireless data service PCS Vision from Sprint.

"This agreement," according to Qwest Chairman Richard Notebaert, "allows us to provide customers with nationwide wireless service and the convenience of Qwest's integrated land-line to wireless features.

"In addition, Sprint's cutting-edge wireless data applications make our comprehensive package of telecommunications services one of the most compelling combinations available."

Qwest and Sprint plan to move Qwest wireless customers, as well as new Qwest subscribers, to the Sprint Nationwide PCS Network by next year."

-Bill Radio

Western U.S. Wireless Reviews & Ratings:
http://www.MountainWireless.com

[larry]

Wow any word on if Sprint will benefit with Qwest's coverage in Montana and the Dakotas?

[BillRadio]

Larry,
Some of this is yet to unfold. Qwest's News Release gives a little more detail, including the fact that Qwest will continue billing and sales (those users here waiting for this to be decided should keep their jobs!).

It appears as though spectrum is not part of the agreement, so it could be up for sale, soon. Sprint could use the sites in MT & WY, but that may be a deal between Qwest and Ubiquitel, the local affiliate. The potential of this deal could be what has kept Sprint (Ubiquitel) from expanding in those states. But neither Ubiquitel nor Sprint has much cash to buy these sites, so Qwest will need to make a deal to keep all thses deals "cashless".

It bears watching. Qwest's stock went up, Sprint's went down.

-Bill

[jayc]

This is an interesting strategy... seems to be a win win situation for qwest... not so sure for sprint.

[larry]

Jayc,

Sprint wouldn't have made this deal if they weren't going to benefit by it in some way. What about all the new customers they wil be getting? What about a new sales channel for it's Vision services?

[jab]

It will be interesting to see what happens. As a Qwest customer I have been happy, my friends with Sprint have not.
I will try the Sprint network switch and see how it goes. I hope 7PM nights stays!
Jen

[jayc]

I would say the new plans will be what Sprint offers... I wonder how they would migrate the unlimited customers if they were to sell off their spectrum?

larry- good point... it just seems like a strange deal. I guess not though, sort of like the Alltel simple freedom using VZW in some markets.

[IowaUser]

The additional spectrum would definitely help Sprint. However, aren't we missing the obvious here? Because Sprint does not have towers in Rapid City, SD, for example, Sprint would have to use Qwest's towers. How else would Qwest use Sprint's towers? Surely this is an indication that in areas where Sprint does not currently offer service, that Sprint will use the spectrum and towers currently used by Qwest. How else would it work? Would Sprint add Vision to Qwest's towers??

In the end, this deal will probably benefit Sprint more. Qwest has been falling apart, and with services getting integrated with Sprint, any potential sale of Qwest's wireless division would be cheap for Sprint in bankruptcy court. In the more immediate future, this deal gives Sprint more customers and keeps Qwest afloat for another year. The reaction on Wall Street is pretty typical. You'll notice the same reaction when companies merge. The larger company's stock goes down while the smaller company's stock goes up.

I guess we'll just have to wait and see for more info about this deal.

[larry]

Yes I agree that Sprint will have to have some sort of deal to aquire spectrum and towers in Qwest markets not currently served by Spint such as Montana and Rapid City, SD. If Qwest is going to offer Sprint service in markets not currently served by Sprint then Sprint will have to take over these towers and spectrum I would think. It appears that us Sprint customers will have some greatly expanded coverage in the West with this deal. This will give Sprint a big advantage (coverage wise) over some other carriers such as T-Mobile and Cingular.

[jayc]

The way I understand it is- no spectrum was included in this deal. Right?

[jayc]

Originally posted by: jayc
The way I understand it is- no spectrum was included in this deal. Right?

I think Sprint is more concerned (or apparently maybe not) about the affiliate coverage in jeapordy... aquiring additional spectrum would be the last think I'd be concerned about.

[larry]

Yes so far no spectrum has been announced as part of this deal. But Sprint will have to take over some of Qwest's towers in order for this deal to work. They can take over the towers without buying the spectrum since they already own their own spectrum in those markets.

[BillRadio]

Here's an even MORE detailed article on the deal.

John Garcia, Sprint senior vice president of marketing: "We'll be adding capacity to our network and adding some coverage we don't have that Qwest does have."

That a very good sign when Sprint says they will be adding capacity in new areas:

Garcia said capacity will be added in Montana, and suburban areas of Qwest's territory. He said that may include buying some equipment from Qwest.

Qwest reports they will offer Vision, and there's no reason to believe Qwest subscribers in, say, Bozeman, MT, won't have that access. But there's no reason to think that the Qwest spectrum will ultimately be used when Sprint has more there.

Upside: Qwest will offer at least different features and plans than Sprint, just like Virgin.
Downside: Many markets will lose a competitor. Too bad Cingular shot its wad on the Nextwave licenses.

Qwest could have an auction. Cingular could buy Phoenix, Denver & SLC spectrum, Verizon could grab the rest of UT, MN, MT, AZ, NE they don't already have, and T-Mobile could use a few rural areas.

-Bill

[larry]

Yeah I figured Sprint would have to gain some coverage out of this deal. This will be nice for Sprint users who travel to those rural areas. It will also give them an edge over T-Mobile, coverage wise.

[larry]

I would also think we can expect a new PRL for all Sprint users soon.

[Gman]

Sprint's taking over of the Montana market from Ubiquitel will help ease that company's financial strain as well as allow them to focus their capital expenditures on developing current markets rather than building out Montana/Wyoming. This facilitates the QWEST deal further by allowing the QWEST deal to be with SPCS instead of Ubiquitel in Montana/Wyoming.

G.