Sprint Nextel

Will SK Telecom get closer to Sprint?

Dan O'Shea — Wed, 16 Jul 2008 10:34:18 -0400

CNBC reported late yesterday that Korean carrier SK Telecom was planning to bid to acquire troubled U.S. wireless carrier Sprint Nextel. Other news outlets, including The New York Times, have suggested there is a deal under discussion, but that the "deal" is more likely a partnership or a minority equity investment. Sprint has been climbing back from the tailspin that saw the carrier lose many customers and key executives, and question its WiMAX plans. New Sprint CEO Dan Hesse may have the company thinking about growth again, but acquisition rumors have persisted. SK Telecom, by the way, is familiar with Sprint, having been a customer of the U.S. network operator through the Helio venture.

For more:
- read this report at The New York Times

Related articles:
Sprint rejects SK Telecom's $5B investment SK Telecom report
In July last year, SK Telecom said it had no plans to acquire Sprint SK Telecom report

Cisco upgrades IPoDWDM, lands Sprint deployment

Dan O'Shea — Tue, 15 Jul 2008 19:05:28 -0400

Cisco Systems announced enhancements to its much-debated IP-over-dense wavelength division multiplexing technology, and also landed another major carrier customer--Sprint--for a 40 Gbps CRS-1 IPoDWDM deployment. The improvements to the IPoDWDM modules include, according to a story at Network World, a doubling of reach in a 40 Gbps CRS-1 deployment to about 1,250 miles without regeneration; the extension of IPoDWDM to Cisco's XR 12000 and 12000 routers with a new 10 Gigabit Ethernet shared port adapter; the addition of a reconfigurable optical add-drop multiplexer to reduce provisioning on the Cisco ONS 15454 optical transport platform; the re-setting of failover benchmarks to 15 milliseconds; and the enabling of direct management of optics integrated into the router.

Meanwhile, Sprint becomes Cisco's second major CRS-1 IPoDWDM customer for a 40 Gbps project. Cable TV giant Comcast was the first. The enhancements, in particular the 15 ms. faliover--more than three times faster than the industry standard of 50 ms.--might help Cisco's cause with other carriers.

For more:
- see this story at Network World
- read this story at Telephony

Related articles:
Cisco unveiled the Nexus 7000 platform earlier this year. Cisco report
Cisco CTO Padmasree Warrior has been busy prioritizing. Cisco report

Spotlight: Hesse tops CEO pay heap

Dan O'Shea — Mon, 30 Jun 2008 09:32:27 -0400

Earlier this year, we followed news of what various service provider CEOs were paid during 2007, and with rare exceptions, readers almost always felt the figures reported were too high. Now comes word that Dan Hesse, who was hired as CEO of success-challenged Sprint Nextel last December, is the highest paid CEO in the industry, according to how the Associated Press calculates such things. The AP reports that Hesse is making $28.3 million this year, though the figure includes bonus and option money tied to his hiring. Considering the challenge he took on, is that figure much of a surprise?

For more:
- see this Associated Press report at Yahoo! Finance

Related articles:
AT&T CEO Randall Stephenson took home $18 million last year AT&T report
Verizon CEO Ivan Seidenberg was paid just over $20 million Verizon report

NXTcomm: Verizon defends U.S. broadband, Sprint resumes 4G launch plan

Dan O'Shea — Thu, 19 Jun 2008 05:11:43 -0400

Wednesday's keynote speakers at NXTcomm touted their companies' respective accomplishments and new service plans in wireline and wireless broadband. Verizon Communications president and COO Denny Strigl officially announced the news that had broken earlier that morning--that Verizon is expanding in 50 Mbps top-tier FiOS service to more markets. He also took critics of lagging U.S. broadband penetration to task for apparently not focusing on the broadband numbers that really matter, and apparently the numbers that should really matter, according to Strigl, are the ones that demonstrate the sheer size of the market, and the speeds and penetration levels in selective markets that offer a more apples-to-apples comparison with other countries.

Strigl said it also must be noted that the U.S. broadband market has grown to more than 100 million connections via private investment, a direct knock on those countries where the government has played a strong handed in forcing carriers toward broadband goals.

Speaking after Strigl, Sprint CEO Dan Hesse said Sprint will launch its next-generation wireless broadband service, based on WiMAX, in Baltimore in September. It will be a small step that comes after delays, but considering some in the industry were speculating just a few months ago that Sprint would drop WiMAX, it is a significant step. Hesse touted the service as "open broadband, no walled gardens," but added almost as a disclaimer: "Some carrier control [of bandwidth usage] will be required so the network is not held hostage" by a small number of overachieving downloaders. Such disclaimers are now increasingly frequent with any carrier executive's mention of broadband. Still, Hesse further added a bit awkwardly that any new broadband regulation was a bad idea.

For more:
- read this report of Strigl's comments at Telephony
- see this post about Hesse's speech at Telephony

Related articles:
Verizon FiOS is coming to New York City Verizon report
Sprint recently revived its WiMAX joint venture plans Sprint report

Embarq to end wireless partnership with Sprint

Thu, 15 May 2008 06:59:56 -0400

Independent telco and Sprint Nextel spin-off Embarq confirmed that it will end its wireless resale partnership with its former parent company next year. It is a sad situation, being jilted by one's offspring after they move out on their own--you can no longer tell them to go to their room. With Qwest Communications ending its own resale deal with Sprint recently, Sprint is unfortunately getting a lot of experience with the feeling of not being wanted. Consider its retribution for Sprint claiming Embarq's former CEO Dan Hesse as its own.

Embarq reported has only 112,000 wireless customers; it hoped a Sprint alliance would bring it 1 million. That is a big discrepancy between hope and reality, but you also have to wonder if the hopes may have been unrealistic. In a market full of very competitive national giants (as opposed to being lazy incumbents), can a somewhat smaller telco with less wireless experience really expect to land 1 million customers? And if a telco like Qwest or Embarq truly wants wireless success, is having a wireless resale partnership really enough? It will be interesting to see how much better off Qwest is with new partner Verizon Wireless and how much better a partner Embarq can find.

For more:
- read this report at The Wall Street Journal

Related articles:
- Embarq lost Hesse to Sprint Nextel last December. Embarq report
- First Qwest, now Embarq rethinks Sprint deal Qwest report

Clearwire gets bigger; so does its Q1 losses

Tue, 13 May 2008 06:59:57 -0400

Clearwire Corp. may be on the cusp of a planned WiMAX revolution with Sprint in the future but, like its primary partner in its new joint venture, is struggling in the here and now.

After market close yesterday Clearwire reported losses of $176 million, or $1.08 per share, nearly double its losses in the quarter a year ago, despite revenue that increased some 76 percent to $51.5 million. Clearwire said the losses were due to its expansion in seven large markets.

Not all the news was bad. The company said its subscriber base grew 72 percent from a year ago, ending the quarter with some 443,000 subscribers.

It's deal with Sprint, Google and cable TV partners is expected to close in the fourth quarter. Sprint just reported losses of $500 million in the quarter and saw 1 million subscribers get out of Dodge.

For more:
- Read the Associated Press story in BusinessWeek

ALSO NOTED: Verizon spends $3.9 million lobbying; Panther hires Liddell as CEO; and much more...

Mon, 12 May 2008 06:59:51 -0400

> Verizon Communications spent about $3.9 million during the first quarter lobbying federal government officials on a number of issues. Article

> Content delivery network firm Panther Express hires former Level 3 and MCI WorldCom executive Steve Liddell as CEO. Article

> Sprint Nextel posted a $505 million first-quarter loss. Article

DT chief chats M&A; report fuels Sprint rumors

Fri, 09 May 2008 06:59:57 -0400

Will Deutsche Telekom make a move on Sprint Nextel, or are there too many hurdles to overcome for such a super-sized inter-market merger?

The German telco has, for the most part, been typically stoic in its lack of comment about a possible deal. But there has been plenty of speculation from analysts and competitors about DT's ability-or inability-to merge two incompatible technologies, not to mention cultures.

DT CEO René Obermann may have revealed the telco's hand a bit Thursday when he told analysts during the company's earnings call that, "We can't rule out acquisitions which, when evaluated under strict financial and business criteria, would bring a clear profit and return on investment. That we must do and we will continue to do in the future."

A person briefed on the situation told the International Herald Tribune the German company and Sprint had been in talks about a possible takeover for two weeks. A deal could be worth some $52 billion, leapfrogging T-Mobile from third to first in the U.S. mobile market ahead of AT&T and Verizon. The Trib also reported the two companies already had approached the FCC about possible objections to the deal. Sprechen Sie Deutsches im Kansas City?

T-Mobile USA, by the way, reported it added one million customers in the first quarter, bringing it over the 30 million subscriber mark.

For more:
- Read the International Herald Tribune's story

DT posts earnings boost, landlines decline 6.3%

Thu, 08 May 2008 06:59:54 -0400

Germany's Deutsche Telekom reported first quarter earnings growth of 33.2 percent to $1.16 billion, though some of the increase came from the sale of a media business. The company saw revenue decline about 3.1 percent to $23.14 billion, and it partially blamed the drop on ongoing landline losses. Landline users slid about 6.3 percent to 35.9 million customers.

Meanwhile DT CEO Rene Obermann declined to address widely-reported rumors that the company is interested in acquiring Sprint Nextel. DT officials did comment on another potential deal, the company's effort to raise its recently acquired 20 percent stake in Greek telco OTE to 33 percent. DT said it is negotiating with the government in Greece for full management control of OTE.

For more:
- read this Associated Press story at Forbes

Related articles:
- Deutsche Telekom said in March it was buying 20% of OTE. Deutsche Telekom report
- DT recently announced several IPTV moves while at CeBIT DT Report

All-star team re-ignites national WiMAX venture

Wed, 07 May 2008 06:59:57 -0400

Sprint Nextel, Clearwire, Comcast, Google, Time Warner Cable, Intel, Bright House Networks--'nuff said. Those firms--proven telecom industry giants, with the exception of Clearwire (okay, maybe Bright House, too), though Clearwire was founded by industry giant Craig McCaw--are reviving the national WiMAX joint venture that had earlier been pursued by Sprint and Clearwire. They collectively are investing about $3.2 billion in the venture, and the resulting equity breakdown will have Sprint owning 51%, Clearwire 27% and the remaining companies about 22%. Some sort of teaming between Sprint, Clearwire and the cable TV companies had been rumored for some time, since before the cable TV firms recently executed their Pivot partnership with Sprint. Google had been rumored to have interest as well.

Some observers are already seeing the joint venture as a master-stroke by Sprint CEO Dan Hesse and a move that could help save seriously damaged Sprint. However, there also have been rumors this week that Sprint could sell Nextel, and/or that Sprint itself could be acquired by Deutsche Telekom, so there could be more moves yet to play out. Or maybe not. In any case, other observers see the new mega-venture as a huge benefit to Clearwire, which previously has been modestly successfully at expanding broadband fixed wireless into a few dozen markets, but now gains huge investors and partners for what would have been its next move--a WiMAX upgrade. And, oh yeah, the new venture will be called Clearwire, so essentially, McCaw has sold the telecom industry its future for the second time in his career.

Sprint and Clearwire both will benefit from this super-venture, but what about Google? The Internet giant has had a good week that is only half over. First, it watched Microsoft's bid to acquire Yahoo!--the best bet for either company to mount a better competitive assault against Google--fall apart. Now, it is buying itself a piece of the wireless future, but will pay much less for it, and will take on less risk, than it would have if it bought its own spectrum and built its own network. And yet, it will have a major hand in shaping an open 4G network. Google may be the biggest winner.

For more:
- read this story at The Wall Street Journal
- here's what Om Malik is saying at GigaOM

Related articles:
- Reports of a Sprint/Clearwire/Comcast/Time Warner joint venture first emerged in late March. Sprint/Clearwire/Comcast/Time Warner joint venture report
- Pivot fell to pieces late last month. Pivot report