Mega Mobile Merger Mania
I guess Sprint and Nextel felt a bit vulnerable now that Cingular is in the middle of digesting AT&T Wireless. Various chatter on blogs and forum sites suggest that Sprint and Nextel have either agreed to merge or are very close to doing so. Since there’s no “official” statement on the matter from either companies at this point, it’s hard to say if it’s true or not.
I view this merger as a challenge, at least more of a challenge than Cingular and AT&T Wireless, which at least used the same GSM and TDMA technology. In fact, even though Cingular is still working on integrating AT&T Wireless into the fold, immediate benefits were obtained from this merger, in some cases even before the merger took place. Since February 2004, when the Cingular/AT&T Wireless merger was announced. AT&T Wireless had access to all of Cingular’s towers by means of roaming agreements. Since mid-October 2004, at least some AT&T Wireless customers were getting to call Cingular customers and being charged mobile-to-mobile rates. It’s unclear if Cingular customers were getting recipricoal treatment, but hey, as an AT&T Wireless customer at the time, I was quite happy!
On the other hand, Sprint and Nextel use completely different technologies. Sprint uses CDMA, which Nextel uses the more proprietary iDEN. Reports are that Nextel was planning on getting rid of iDEN anyway, and this certainly gives them a good excuse to do it. But it’s going to be a slow, expensive process. They not only have to convert the towers, they are going to have to convince their customers to get new handsets (and presumably sign new contracts). If most people are like my wife or my elderly aunt and uncle, they’re just not going to do it unless they are forced to.
One other trick is going to be getting Push-to-Talk to work right in CDMA. If Verizon’s Push-to-Talk is any indication, they’ve got a lot of work to do. I suppose that a combined Sprint/Nextel could offer their customers free calls between the two networks, but it’s going to take a while for customers to gain any other benefits from the merger.