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Sales of Wireless Data Are Paying Off for Sprint Nextel: First Quarter Sees 77% Increase From a Year Ago

Posted on: Thursday, 11 May 2006, 06:07 CDT

By Jason Gertzen, The Kansas City Star, Mo.

May 11--All the mobile Internet surfing and music playing is starting to bring in real money for Sprint Nextel Corp.

The nation's No. 3 wireless company is on pace for $3 billion this year in sales of its growing menu of wireless data services, Oliver Valente, Sprint's senior vice president of product development, told analysts Wednesday.

"We will continue to focus on growing this," Valente said in his presentation at the CIBC World Markets Media, Internet and Telecommunication Conference in Boston. The presentation was available by teleconference.

Wireless data sales for Sprint totaled $800 million in the first quarter, a 77 percent jump from a year ago. They contribute $7 in average revenue for each subscriber, a figure that leads the wireless industry.

Not only do customers subscribing to these services tend to spend more, but also they are less likely to defect to a competitor's wireless service, Valente said.

Toward the end of the year, Sprint will launch new phones that can access all of these data services available on the Sprint network and function as a highly efficient walkie-talkie on the network built by Nextel Communications Inc., Valente said.

The Nextel customer base remains extremely valuable as nearly 20 million customers are using the walkie-talkie service, Valente said. A walkie-talkie service offered over Sprint's network has not been nearly as popular.

The dual mode flip phone "with plenty of battery life" will be important for continuing to serve the loyal base of customers for the Nextel brand while giving them a taste of some of the new services, he said.

On Wednesday, the joint venture Sprint has with four of the nation's largest cable companies drew attention with its possible plans to participate in a coming federal auction of radio wave spectrum.

"We are evaluating whether it would be a good idea to more directly own spectrum," Glenn A. Britt, Time Warner Cable's president and CEO, said during a presentation to investors.

Time Warner executives remain committed to the joint venture and are pleased as it moves to early market tests later this year, Britt said.

"We believe that adding the convenience of mobility to our popular services could make our offerings a lot more attractive," Britt said.

Sprint stock closed Wednesday at $25, down 1 cent.

To reach Jason Gertzen, call (816) 234-4899 or send e-mail to jgertzen@kcstar.com.

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Copyright (c) 2006, The Kansas City Star, Mo.

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Source: The Kansas City Star (Kansas City, Missouri)

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