Sprint COO, Cingular merger hasn't caused an impact

[Fire14]

Sprint COO: No Impact From Cingular-AT&T Wireless Merger

NEW YORK -(Dow Jones)- The combination between Cingular Wireless and AT&T Wireless hasn't had any impact on Sprint Corp. (FON), despite concerns, said President and Chief Operating Officer Len Lauer.

Cingular, which acquired AT&T Wireless last year, came out with impressive fourth-quarter numbers, spurring fears that the other carriers had lost customers. That wasn't the case, Lauer said during an investor presentation at a Banc of America Securities conference in New York on Wednesday. Cingular is a joint venture between SBC Communications Inc. (SBC) and BellSouth Corp. (BLS).

Sprint is in the middle of its own deal with Nextel Communications Inc. (NXTL), which is expected to close later this year.

Sprint can realize cost savings through reducing common operations such as shared services, public relations, finance offices, and other similar operations. The combined company will also have stronger purchasing power and be able to get better value out of its supply chain, Lauer said.

Sprint can use Nextel's Nascar racing sponsorship to better target consumers, he said. It can also sell wireline services to Nextel's business customers.

The telecommunications industry is going through a transformation, partly driven by the trend of convergence, such as the combination of multiple devices on the cell phone, Sprint's Lauer said.

Sprint has worked on targeting growth, while maintain a high level of profitability and average revenue per user, he said. The company's "fair and flexible" payment plan has been key to many of its new customers.

Churn, or the rate at which customers cancel their service, is another priority for Sprint. Lauer is targeting a churn rate similar to Verizon Wireless service, which leads the industry. Verizon Wireless is a venture of Verizon Communications Inc. (VZ) and Vodafone Group PLC (VOD).

Sprint continues to target subprime customers, which has led to higher involuntary churn, he added.

The company is also conducting video trials with fiber to the node, or bringing the high-speed fiber network closer to its customers, he said.

Video-streaming services, location-based services and the ability to access your personal video recorder from your cell phone are among several of the different features Sprint is introducing. He sees strong uses in video e-mails via the phone, similar to the trend of picture e-mails now.

Sprint recently traded at $22.38, up 37 cents, or 1.7%, on volume of 8.9 million shares. Average daily volume is 13.1 million shares.

-By Roger Cheng, Dow Jones Newswires; 201-938-2020; roger.cheng@dowjones.com

[bobolito]

Sounds like a promising future for Sprint.