NEW YORK (Reuters) - Sprint Nextel Corp. could cut the price of its high-speed wireless service after bigger rival Verizon Wireless slashed its price by 25 percent, a top Sprint executive suggested on Wednesday.
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Sprint Nextel, the No. 3 U.S. mobile phone service, began selling high-speed wireless services to laptop computers in some markets for about $80 a month and expects the service to be available to half of the U.S. population by early 2006.
The No. 2 U.S. mobile operator Verizon Wireless, a venture of Verizon Communications Inc. and Vodafone Group Plc, already offers similar services in more than a third of the country. It said on Monday it was cutting the price of its high-speed laptop service to $59.99 from $79.99 a month.
"We will quickly have a competitive response," Sprint's chief operating officer Len Lauer said in an interview without giving details on the timing or the extent of that response.
Mobile companies are beefing up their networks to deliver services such as Web surfing and video streaming at speeds comparable to some home computers. The bet is that revenue from data services will eventually offset falling mobile phone call prices.
Verizon Wireless, which started selling high-speed services in two markets in October 2003, is further along than Sprint in building its high-speed network.
But Lauer noted that Sprint, which bought Nextel Communications this month to form Sprint Nextel, has historically derived the highest percentage of service revenue from data services even with slower network speeds.
Sprint's most popular data service is accessing the Internet on phones, with game and ringtone downloads ranking next, followed by text messaging and then the swapping of pictures taken on mobile phones with built-in cameras, Lauer said.
The Nextel deal gives the combined company more wireless airwaves, including spectrum in 80 percent of the top U.S. communications markets. This spectrum in the 2.5 Gigahertz (Ghz) frequency band could be suitable for providing even faster future data services.
Sprint is looking at several technologies for use in this spectrum and has plans to test a technology known as WiMax, an emerging standard which is being heavily backed by giant chipmaker Intel Corp. and is expected to cover entire cities with high speed wireless Internet services.
But Sprint is also considering rival options, including a technology called OFDM from Flarion Technologies, which is being bought by Qualcomm Inc.. Qualcomm developed EV-DO, the technology used in Sprint and Verizon's high-speed networks and their earlier generation more voice-centric networks.
Lauer said Sprint is still far from deciding whether it will use WiMax, Flarion or another technology in the 2.5 Ghz spectrum.
Asked if Qualcomm's purchase of privately held Flarion, which has attracted a lot of attention but struggled to win commercial deals, could increase the odds for Sprint choosing Flarion over WiMax, Lauer said Qualcomm's backing could help.
"It increases the credibility of Flarion," Lauer said.
Sprint Nextel shares were up 66 cents or 2.6 percent at $25.91 in late afternoon trade on the New York Stock Exchange.
http://news.yahoo.com/s/nm/20050831/wr_nm/telecoms_sprint_data_dc;_ylt=AqkhxInq15KFQafenzbTy3IjtBAF;_ylu=X3oDMTBiMW04NW9mBHNlYwMlJVRPUCUl
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Sprint Nextel, the No. 3 U.S. mobile phone service, began selling high-speed wireless services to laptop computers in some markets for about $80 a month and expects the service to be available to half of the U.S. population by early 2006.
The No. 2 U.S. mobile operator Verizon Wireless, a venture of Verizon Communications Inc. and Vodafone Group Plc, already offers similar services in more than a third of the country. It said on Monday it was cutting the price of its high-speed laptop service to $59.99 from $79.99 a month.
"We will quickly have a competitive response," Sprint's chief operating officer Len Lauer said in an interview without giving details on the timing or the extent of that response.
Mobile companies are beefing up their networks to deliver services such as Web surfing and video streaming at speeds comparable to some home computers. The bet is that revenue from data services will eventually offset falling mobile phone call prices.
Verizon Wireless, which started selling high-speed services in two markets in October 2003, is further along than Sprint in building its high-speed network.
But Lauer noted that Sprint, which bought Nextel Communications this month to form Sprint Nextel, has historically derived the highest percentage of service revenue from data services even with slower network speeds.
Sprint's most popular data service is accessing the Internet on phones, with game and ringtone downloads ranking next, followed by text messaging and then the swapping of pictures taken on mobile phones with built-in cameras, Lauer said.
The Nextel deal gives the combined company more wireless airwaves, including spectrum in 80 percent of the top U.S. communications markets. This spectrum in the 2.5 Gigahertz (Ghz) frequency band could be suitable for providing even faster future data services.
Sprint is looking at several technologies for use in this spectrum and has plans to test a technology known as WiMax, an emerging standard which is being heavily backed by giant chipmaker Intel Corp. and is expected to cover entire cities with high speed wireless Internet services.
But Sprint is also considering rival options, including a technology called OFDM from Flarion Technologies, which is being bought by Qualcomm Inc.. Qualcomm developed EV-DO, the technology used in Sprint and Verizon's high-speed networks and their earlier generation more voice-centric networks.
Lauer said Sprint is still far from deciding whether it will use WiMax, Flarion or another technology in the 2.5 Ghz spectrum.
Asked if Qualcomm's purchase of privately held Flarion, which has attracted a lot of attention but struggled to win commercial deals, could increase the odds for Sprint choosing Flarion over WiMax, Lauer said Qualcomm's backing could help.
"It increases the credibility of Flarion," Lauer said.
Sprint Nextel shares were up 66 cents or 2.6 percent at $25.91 in late afternoon trade on the New York Stock Exchange.
http://news.yahoo.com/s/nm/20050831/wr_nm/telecoms_sprint_data_dc;_ylt=AqkhxInq15KFQafenzbTy3IjtBAF;_ylu=X3oDMTBiMW04NW9mBHNlYwMlJVRPUCUl
