Sprint And Nextel To Combine In Merger Of Equals

Re: Sprint and Nextel Merger ?

So having Sprint to Nextel (and vice versa) calling counting as PCS to PCS would not be a benefit for us??

In time I would expect that coverage would be improved for both carriers as they combine some of their towers together. I know that's a long way off but it's still going to be a benefit for us Sprint users when they can get the phones and systems to work together (and they will figure how to do it). Think of all the towers the combined company will have.

 

Re: Sprint and Nextel Merger ?

Yes, it sure does!

 

Re: Sprint and Nextel Merger ?

Ok, let me clarify my statement to avoid confusion:

The Sprint/Nextel merger won't offer any IMMEDIATE benefits for customers. Their coverage won't change because of the incompatible systems. They really cannot combine towers, unless there's some magical way to make iDEN and CDMA talk to each other and have a CDMA phone connect to an iDEN tower. Furthermore, if you eliminate an iDEN tower because Sprint has a tower in that same spot, then you lose the PTT service there. If a redundant AT&T tower is eliminated, GSM phones can still use a nearby Cingular tower. See my point? With the Cingular/AT&T merger, there were IMMEDIATE benefits. My phone started using both AT&T and Cingular networks within days after the merger occured. There's no way your Sprint phone will start using Nextel's network within days, or ever, after their merger. Cingular/AT&T are starting to combine their channels and licenses so that both networks and all existing GSM phones use the same channels. Sprint/Nextel can't do that.

Sure M2M will be a benefit, but I am talking about coverage and network improvements. You will not automatically gain coverage in places where Nextel has coverage and Sprint doesn't or viceversa. Sprint will have to physically build another network in those areas for you to gain coverage there. See my point?

Besides that, if you really want to see some combined benefit of both networks, you'll have to get a new phone. Nextel phones can't use CDMA and your phone can't use Nextel's PTT no matter what you do to it. With a combined iDEN/CDMA phone, which is not even remotely in the production lines, then you'd see some partial benefit. However, such combined phone might be years away.

Bottomline, the only thing Sprint can do is expand CDMA to those places where Nextel has coverage and Sprint lacks, and conversely expand Nextel's coverage to those places where Sprint has coverage and Nextel doesn't. But a true integration cannot occur. Any coverage benefits will be given to customers through expansion, not through combination.

Frankly, the only way to get some sort of iDEN/CDMA integration would be to modify both CDMA and iDEN technical specs and that's not going to happen. Remember what happened when Cingular wanted TDMA and GSM to talk to each other? It didn't work! It is pretty much common knowledge that Sprint will remain with the CDMA standard technology which can't talk to or integrate to iDEN just like TDMA and GSM don't talk to each other. GAIT was just a way to put two incompatible phones into one case. Nothing more. In a GAIT phone, GSM and TDMA never really connected to each other even inside the same phone. The GSM side of the phone needed to be inactive for the TDMA side to work. The same thing may happen to a CDMA/iDEN phone.

And let's forget about handoffs....do you really think you will ever see a CDMA to iDEN handoff?

 

Re: Sprint and Nextel Merger ?

Of course I know all of that. I was just pointing out that some day in the future there will be coverage benefits from this when they figure out how to do it. Obviously there are ways of improving coverage from this deal (Sprint adding/changing panels & hardware to Nextel towers, etc). The mobile to mobile minutes will be a nice benefit to us. I'd be satisfied with that alone since there are 2 or 3 Nextel users that I often call. Plus I have a few other friends with Sprint who often call Nextel customers.

In addition to this there is talk of a technology called Qchat which will enable Sprint and Nextel users to use PTT and Ready Link together so that we can have walkie-talkie interoperability. So there are certainly benefits from this that could come rather quickly (1-2 years). PCS 2 iDEN calling would likely be the first benefit and that could come right after the deal is officially approved.

I also wouldn't mind buying a new phone either if that was required.

 

Re: Sprint and Nextel Merger ?

Even the mobile to mobile aspects would be really tough to integrate, especially now that LNP is in place. The billing system merger would be very tough as well.

Sprints bills are pretty easy to read and understand, Nextel's on the other hand can be a bit confusing.

With Nextel having to change to different bandwidth, it is a really good time for them to change to a different technology as well, my only question is how much overlap does the fcc allow nextel from the time the turn on their 1900 mhz to the time they have to abandon the 800 mhz?

If it's a substantial amount of time, then they would have some time to not only change out radio cards and antenna's etc, but maybe overhaul their entire infrastructure to new technology other than iden.

And another question is how compatible is Sprint's Ready link service to Qchat?

A merger like this doesn't seem to make any imediate sense, except for the hopes of both companies to maintain their existing customer base while they integrate their technologies. (as noted by bobolito it's going to be much harder than the Cingular At&t merger.)

I'm also wondering what the Sprint Affiliates are thinking right now, because they have an exclusive right to market in their territories, and they compete against Nextel in many areas, would they now be competing against the combined Sprint/Nextel? Or would those Nextel areas be given to affiliates?

What about Nextel Partners? Boost? ESPN? Future At&t wireless? Virgin?

 

Re: Sprint and Nextel Merger ?

That's my big question, too. That is going to be the most interesting part of this whole thing.

 

Re: Sprint and Nextel Merger ?

Yep there are a lot of question marks involved here but Obviously the big wigs in the companies have a plan for all of this or it wouldn't be happening.

 

Re: Sprint and Nextel Merger ?

Yep Larry, I'm sure they have a plan, as long as it is good for shareholder value, it's not so much that the competition bothers me, it's the way these changes will effect the employees of these companies.

Of course the only thing constant about the wireless industry is change, if anyone has worked in it longer than a week I guess they should know that.

 

Re: Sprint and Nextel Merger ?

There was once a time where you could get a high paying job with phone company and retire with it. Now, you never know when an upcoming merger or buyout will mean you will be out of a job. Even if your company doesn't merge right away, your job may still be in jeapordy if your company decides to send your position overseas. As companies get bigger, lookout for more outsourcing support to offeset all the expenses that come with big business.

 

Re: Sprint and Nextel Merger ?

Larry, one thing I like about Sprint Business Support, is when I call them, I get a easy to understand representative. I deal with Sprint everyday with my line of work. They are still small enough to where they seem to give us that local friendly support. I hope things don't get too messy as this may affect the level of service my customers expect. I have signed up so many customers directly with them and I hope this does not come back to haunt me.

We get so many complaints about SBC it isn't funny anymore. Our customers are now asking for Cable instead of SBC DSL since their support is awful. I may ask them to run a line test for me and they still have to go through their entire script which makes things so frustrating and time consuming. On top of that, SBC Broadband Business Support is notorious for hanging up on customers when they don't know what to do. I know if this thing goes through, only the local division of Sprint is to be affected so they say. I wonder if this local service includes DSL or ISDN. If it does, I will have a lot of late night stays at the office to look foward to.

Behind the scenes, mergers can be sooooooo messy. I know after reading posts from people on the outside that they feel everything goes so rosy with these kinds of things because their carrier promised them it would. Big companies like to make their consumers feel that way, but most likely reality is purely the opposite. People lose thier jobs. Technical support becomes distorted and misguided. Billing errors increase. Confusion and gossip spreads around the workplace often spread by upper management. Customer service gives conflicting information to their customers usually due to lack of proper knowledge or training. These are unavoidable and do happen. Because I'm involved with it, I am usually left with a mess of my own to clean up.

 

Re: Sprint and Nextel Merger ?

I am assuming you are talking about native coverage and not free roaming. What you are talking about would only work with having the most native coverage. If you are talking about coverage that would be considered home coverage (native coverage + free roaming), I don't think your statement would apply. Nextel's coverage nationwide is a far from matching any carrier. Sprint is not much better, but it's better.

 

Re: Sprint and Nextel Merger ?

I actually think Nextel has very good nationwide coverage. There IDEN technology requires a lot of towers spaced more closely together than other 800 Mhz networks typically would. Once these are combined with Sprint's huge amount of towers they will have more towers than any of the others. It remains to be seen what they will do with the towers though. Will they change out panels and hardware on Nextels towers so that all of the towers will eventually use CDMA and 1900 Mhz? Or broadcast both Nextel and Sprint from the same tower to start out with (similar to what Sprint did with the Qwest towers they bought)? I guess only time will tell.

 

Re: Sprint and Nextel Merger ?

That would be interesting to see.

Larry, how long would it take Nextel to convert every single one of their towers to CDMA?

Also, what would happen with Nextel's coverage in Canada if this merger happens? Would Sprint phones be able to have native coverage in Canada? That would be pretty sweet if we did.

 

Re: Sprint and Nextel Merger ?

There is no Nextel coverage in Canada. There is an iDEN provider in Canada; Nextel subscribers who travel to Canada roam on Telus Mike. I assume that Nextel subscribers using CDMA technology would roam at preferred rates on Telus. Telus (the company) operate both CDMA and iDEN networks and run them as separate brands.

There is also iDEN in Mexico, Brazil, Peru and Argentina, and of course there's SouthernLINC in South Carolina and environs. iDEN's days are numbered.

 

Re: Sprint and Nextel Merger ?

If Sprint gets Nextel, according to Bloomberg Reports, VZW may go for Alltel and acquire an additional 8.2 million wireless subscribers gaining back it's status of top dog. They would gain much valuable entry to areas they do not have native service and they would be picking up a company who is trading around $ 60 and change on the market.

This would be the best scenario for them should it get approved. Alltel already has a 1X network in most areas and could easily be integrated with VZW.

For competition's sake, I hope Sprint can pull off the Nextel merger/buyout and become very successful.

 

Re: Sprint and Nextel Merger ?

I'm wondering what's taking Verizon so long to buy out Alltel. We all know it's going to happen sooner or later.

 

Re: Sprint and Nextel Merger ?

With their stocks so high, they probably want too much money for such a deal. VZW itself hasn't exactly made too many friends with the FCC either so anything they pursue will most likely be highly scrutinized. You never know though. If they feel they're being pushed into a corner, they may be more likely to act. I think they were okay with Cingular being their biggest rival. Now with a possible third being so close, it may be a little to close for comfort.

 

Re: Sprint and Nextel Merger ?

I agree, I think the FCC is looking at Verizon as the 800 # Gorrilla that they need to tranquilize before it's too late.

 

Re: Sprint and Nextel Merger ?

Even our current business friendly administration will be thinking anti-competition if Verizon goes to buy another carrier. Significant diverstures will be required whoever they chase.

 

Re: Sprint and Nextel Merger ?

I think Verizon does want ALLTEL but ALLTEL has no reason to sell. The wireless unit is profitable, has a low churn rate, and is stable. ALLTEL despite it's size is doing quite well and in most of ALLTEL's markets is the number one or two carrier in market penetration. ALLTEL will not sell to Verizon Wireless. They will not be bought out, if anything chances are ALLTEL is more likely to buy somebody else out.

 

Re: Sprint and Nextel Merger ?

Companies don't always have the final say. I think if it is a publicly traded company, another company may do a "hostile" takeover in which they make an offer so sweet the shareholders approve it despite board members' objections.

 

Re: Sprint and Nextel Merger ?

Unlikely, ALLTEL has made it quite clear they will not be bought out and I don't see a hostile takeover happening. I honestly don't think Verizon will ever buy them.

 

Re: Sprint and Nextel Merger ?

For the sake of argument, let's say that Verizon does purchase Alltel. I know, I know, we are all aware that they do not want to sell, but this is just playing devil's advocate.

In Arizona, it is widely known that Alltel and Verizon have the largest and most robust networks as they are the A and B side providers here on the 800MHZ band. There would obviously be an issue with that and the divestment of some of the spectrum. However, the new 800 MHZ Verizon network with the aquisition of Alltel would be by far the best network in the state. They would have unbeatable coverage in Phoenix, and would have roaming virtually everywhere in the state! Even up by the Grand Canyon where only Alltel has a great network. It would be very cool to see a provider especially here in Arizona that everyone would want to be on!

 

Re: Sprint and Nextel Merger ?

Man I hope that doesn't happen.....I like Alltel as is.

Besides the high stock prices and p/e multiples of both stocks,also look at the ownership of Alltel. While they are publically traded, a great deal of their stock (Over 10 MILLION shares) is controlled by the Stephens Family of the Stephens Investment Company in Little Rock. Much of Alltel's management started at Stephens. You can bet Alltel won't do much of anything without the full blessing of Jack and Warren Stephens. Their stock is worth over 500 Million dollars, so they might prefer it stay in the hands of a company they have influence over, instead of that confusing Vodaphone/VRZ deal.

Just my $.02

 

Re: Sprint and Nextel Merger ?

Is the Alltel Wireless division under the ticker symbol AT? I just checked that one and they are still hovering around $60 a share. Very good for a telecom stock these days!

 

Re: Sprint and Nextel Merger ?

Yes, the wireline and wireless business all trades under AT.

 

Re: Sprint and Nextel Merger ?

Thanks finine...

 

Announced

Guess the merger is announced. Now let's see if it goes through. I wonder what Verizon and Cingular's response will be? Interesting...


http://www.sprintnextel.mergerannouncement.com

 

Re: Sprint and Nextel Merger ?

taken from http://www.sprintnextel.mergerannouncement.com

Affiliates and Partners

Through its relationship with independent PCS affiliates, Sprint has expanded its wireless footprint into certain areas of the United States. These Sprint affiliates currently serve more than 3 million subscribers. Sprint expects to engage in discussions with the PCS affiliates regarding those relationships in light of the combination with Nextel in order to achieve a mutually beneficial outcome.

The merger may also trigger certain share purchase rights in Nextel’s agreement with Nextel Partners Inc., a provider of digital wireless communications services under the Nextel brand name in mid-sized and tertiary U.S. metropolitan areas. Nextel owns about 32 percent of Nextel Partners outstanding stock. The agreement specifies a process that defines the timing for the exercise of those rights by Nextel Partners and for determining a price, which is predicated on fair market value at the time the purchase right triggers, under which Nextel would purchase the Nextel Partners shares it does not own. Sprint Nextel will analyze this at the appropriate time in the context of the merger process. In certain circumstances, the process for determining the purchase price under which Nextel would acquire the Nextel Partners shares would extend for a substantial period of time after completion of the merger.

 

Re: Sprint and Nextel Merger ?

Well, it's official: the deal has just been announced!

I just hate how they titled this article. Sprint hasn't acquired Nextel yet!

http://story.news.yahoo.com/news?tmpl=story2&u=/ap/20041215/ap_on_bi_ge/sprint_nextel

Honestly, I am kinda glad if this merger happens. It will further weaken Verizon's arrogance and will probably engage all top three in a price war.