Sprint Nextel may extend network-sharing contract with Clearwire (USA)
Sprint Nextel Corp. and Clearwire Corp. reportedly plan to extend their network-sharing agreement for the next three to five years. According to reports, the deal would enable Sprint to continue using Clearwire’s network to provide its customers services even after the existing contract expires in 2012.
Industry sources claim that a new agreement like this could help bring some stability for Clearwire, which has been suffering financial losses. The company reportedly needs as much as $1 billion to shift its network to Long-Term Evolution (LTE) wireless technology and finance its operations. However, it is suspected that Sprint may reduce the price that was earlier paid to Clearwire for handling the traffic.
As per reports, analysts believe that Sprint may drop its price from the current $10 per gigabyte of data to somewhere around $6 per gigabyte of data. Further, sources claim that an extended deal with Sprint would be highly beneficial for Clearwire as it would greatly enhance the utilization of its wireless network and would provide it enhanced visibility for revenue generating opportunities.
Sprint Nextel CEO suffers 26% drops in his income (US)
A new analytics report has revealed that Sprint Nextel’s President and CEO Daniel R. Hesse has suffered a 26% drop in his income in 2010 to US$9.1 million in 2010, compared to the previous year.
According to report, Hesse received US$1.2 million for his 2010 salary, which was unchanged from the previous year. He also received US$4.4 million in cash-based bonuses and US$15,000 in other compensation, which included security, transportation and 401(k)-matching costs. He also got an additional US$3.5 million in stock and option awards.
The company saw its subscriber base rise slightly in 2010 after several years of decline, but it posted a wider loss than the year before.
Clearwire cancels plans to sell own-branded WiMAX phones (US)
Clearwire has cancelled its plans to sell its own branded mobile phones and will rely instead on handsets supplied by its majority shareholder, Sprint Nextel.
The company originally announced its plans to sell its own branded phones last year.
As per reports, Sprint currently resells the Clearwire WiMAX service and offers three handsets and has plans for several new handsets in the next few months.
As per commentators, the decision by Clearwire to start selling own-branded phones is part of the reason why Sony Ericsson would launch a trademark lawsuit claiming that there will be confusion between their respective logos if the Clearwire logo appears on handsets as well.
AT&T beats Sprint with a higher cash offering (US)
If rumors are to be believed, T-Mobile’s sale discussions were not a sudden decision but that these talks had been going on for about three months, without a single leak to the media.
According to the report, AT&T had been in talks for sometime with T-Mobile’s parent company, Deutsche Telekom and finally won the deal because it was willing to offer a higher cash component for the purchase price. AT&T was also willing to offer a higher than average breakup fee if the sale was cancelled. Possibly, regulatory requirements made it undesirable to complete the deal for them.
According to sources, knowing the deal would face regulatory obstacles, Deutsche Telekom negotiated with AT&T to pay the $3 billion and give it rights for some wireless spectrum if the deal could not be made.
According to Deutsche Telekom Chief Financial Officer, Timotheus Hoettges, the breakup fee was very important to them in the negotiations. In the intensive discussions with lawyers and economists, they concluded that they could be optimistic that the company could get regulatory approval.
As per sources, Sprint Nextel was also unaware that AT&T was talking to Deutsche Telekom until just before the final public announcement was made.
Sprint outlines plans for more IDEN to CDMA Migration (US)
Sprint has outlined plans for its migration of its Push-to-Talk services over to its CDMA network. The Sprint Direct Connect will launch with an initial portfolio of rugged devices from Motorola Mobility and Kyocera. The devices will feature most of the capabilities available on current Sprint Nextel iDEN based phones. The planned portfolio will include an ultra-rugged camera flip phone and an Android Smartphone with a touch screen and a QWERTY keyboard.
Sprint expects to deepen its push-to-talk portfolio by 2012, adding more devices with new form factors and features.
The devices are expected to enable group push-to-talk for up to 200 participants, Land Mobile Radio (LMR) interoperability, and availability notification. In early 2012, Sprint Direct Connect is expected to add more capabilities, including international push-to-talk.
In addition, the Push-to-talk coverage footprint is planned to increase to nearly 2.7 million square miles and is expected to cover a population of 309 million (with the addition of 1xrtt and roaming coverage) – an increase from the iDEN network’s 908,370 square miles covering a population 278 million.
During the nationwide implementation of Network Vision, Sprint expects to continue operating the iDEN network at current performance levels. As the customer base shifts to more broadband-centric push-to-talk applications on the CDMA network and Sprint launches Sprint Direct Connect, iDEN cell sites are expected to be phased out in 2013.
According to Paget Alves, President-Sprint Business, their customers are asking for broadband push-to-talk now. They’ve seen steadily increasing demand for faster data speeds, better and broader coverage, and more applications on push-to-talk devices. Sprint Direct Connect is designed to solve for all three, and is expected to come with sub-second push-to-talk call set-up time initially in Sprint CDMA RevA coverage areas. Sub-second call set up is expected to expand across the U.S. with the implementation of Network Vision.
Alves added, they believe the new push-to-talk service powered by a broadband network and featuring competitively priced rugged handsets and smart phones will represent an unmatched offering in the market.
Keith Pardy leaves CMO post (Canada)
Research In Motion’s Chief Marketing Officer, Keith Pardy is leaving the company. Keith Pardy’s departure comes as the company gets ready to launch its PlayBook tablet computer.
A Wi-Fi-only version of the gadget is expected soon, followed in the summer by one that works on high-speed cellular data networks, including Sprint Nextel’s. The PlayBook is geared toward business users and will include a smaller touchscreen than Apple Inc.’s iPad has.
The company stated that personal reasons spurred Pardy to leave, but he will continue to work with them for six months to help with the transition.
Motorola gets 28% of revenue from just one mobile network operator (USA)
Motorola Mobility has revealed that over a quarter (28%) of its revenues come from sales of phones to just one mobile network operator – Verizon Wireless.
In a list of risks that could affect the company, it noted that it may be difficult to replace or find new large customers, especially with increasing concentration in the USA where there are a limited number of carriers.
The company warned that if any significant customer, particularly Verizon or Sprint Nextel considerably reduced the quantity of handsets or even stopped altogether – then its profitability would be seriously reduced.
That Verizon Wireless has just started selling Apple’s iPhone in the USA is bound to cause concern about Motorola’s long term sales expectations with that specific carrier.
The company added that it does not have long-term exclusivity arrangements with its customers or commitments by them to purchase guaranteed volumes. Moreover, the mobile networks could cancel orders or contracts with little, if any, notice.
Motorola also stated that it’s future profitability could be at risk if Android-based smartphones do not remain competitive in the marketplace – which puts a lot of the company risk reliant on an uncontrolled 3rd-party with which Motorola has limited leverage.
The company noted that as part of its ongoing effort to improve the product portfolio, they have also been rationalizing the hardware platforms to reduce the complexity of the product platforms and system architecture. This allows Motorola to lower the costs to develop and produce future mobile devices.
Sprint to raise fees for smartphone users (USA)
US mobile phone network operator, Sprint Nextel is to raise the monthly fees it charges new smartphone users by $10 to reflect surging mobile data usage. The increase, effective from January 30, means that the lowest priced monthly service plan available to smartphone owners using Sprint Nextel’s network will rise to $80 a month.
The new rate will apply to all new smartphone activations, including devices that use Sprint Nextel’s older 3G network. The company already charges a $10-a-month ‘premium data’ rate for smartphone owners using its higher speed ‘4G ‘WiMax network.
Sprint Nextel’s decision to impose the new charge reflects the changing economics of the US mobile market and, in particular, the much higher data usage by smartphone owners. According to Sprint Nextel, its smartphone owners use on average 10 times more data than traditional phone owners.
It could, however, ease pricing pressure on T-Mobile USA, the fourth-largest US mobile operator, which is owned by Deutsche Telekom. As the lowest cost carrier, T-Mobile has been hardest hit by pricing pressures in the US market, which have grown as the market neared saturation.
It may also signal renewed confidence at Sprint Nextel, which has struggled to halt customer defections in recent years following the merger of Sprint and Nextel Communications.
Deutsche Telekom expects mobile web boost for U.S
Deutsche Telekom Chief Executive Rene Obermann has stated that the company hopes demand for faster mobile internet services will help it gain customers in the United States.
According to him, mobile internet offers good growth chances at the moment, adding that Deutsche Telekom currently has the fastest network there.
Obermann and new U.S. head Philip Humm are due on Thursday to present a strategy for the struggling U.S. unit T-Mobile USA, which is the market’s No. 4 operator but has seen profits fall.
The U.S. represents the group’s second largest market behind Germany and it has about 33 million customers there.
According to Rene, in the U.S., they need an aggressive marketing policy and customer-friendly pricing. The company has to improve their arguments as to why customers should come to them or stay with them.
The U.S. unit plans to double its network speeds this year in order to offer customers the chance to use applications such as video conferencing or multi-player gaming from their mobile phones.
Humm has already said that T-Mobile USA will not charge a premium for its highest-speed services, as it seeks to regain ground on rivals Verizon Wireless, AT&T Inc and Sprint Nextel.
