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Sprint to Axe iDEN at June End - Analyst Blog

Posted
5/3/2013 4:31:00 PM
By: Zacks.com
Referenced Stocks:DISH;S;T;VZ

Sprint Nextel Corp. ( S ) is all set to achieve its goal of terminating integrated digital enhanced network (iDEN) network at the end of Jun 2013, as scheduled almost a year earlier. With this move, the company aims to concentrate on the core Sprint platform, which includes CDMA, WiMAX, Long-Term Evolution (LTE) and other network technologies.

Jun 29 is the last day when customers will be able to avail the iDEN service, with the shutdown scheduled to start from the next day. All iDEN voice and data services including 911 calls will be stalled and Sprint will close down switch locations in addition to powering down equipment and removing backhaul from each cell site.

In order to avoid last minute migration hassle, Sprint has urged users of iDEN Nextel National Network to transfer their connections as soon as possible. The company via customer letters, legal notifications, email reminders as well as text messages has been consistently notifying customers about the impending change.

Customers can shift from iDEN to Sprint's IP-based Direct Connect service and experience triple push-to-talk coverage, international direct connect reach to Latin American nations and 3G broadband data capabilities. The connectivity also offers more business applications, faster social media accessibility and potential push-to-X capabilities on broadband CDMA network.

The elimination of the Nextel platform is part of the Network Vision plan. Over the past few years, Sprint has been struggling to integrate its CDMA mobile network with Nextel's iDEN wireless network (acquired in 2005), resulting in high subscribers losses to other prominent market players like AT&T Inc. ( T ) and Verizon Communications ( VZ ). Management believes the wiping of Nextel platform will provide immediate savings from utilities and maintenance, and additional savings from tower rent going forward.

As part of the Network Vision strategy, Sprint targets to speed up its roll out of LTE services and utilize the 800 MHz iDEN spectrum for its 4G LTE network, which currently operates with 1900 MHz holdings. Apart from cost saving benefits, this program will enhance the company's operations through cell site reduction, backhaul efficiencies, better use of capital and reduced churn.

Sprint - which is competing with Dish Network Corp. ( DISH ) for the acquisition of broadband provider Clearwire Corporation - currently retains a Zacks Rank #3 (Hold).



DISH NETWORK CP (DISH): Free Stock Analysis Report

SPRINT NEXTEL (S): Free Stock Analysis Report

AT&T INC (T): Free Stock Analysis Report

VERIZON COMM (VZ): Free Stock Analysis Report

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