- The Washington Times - Tuesday, August 8, 2006

Sprint Nextel Corp. will spend as much as $3 billion in the next two years to build a new high-speed wireless network, its president said yesterday.

The Reston company, the nation’s third-largest mobile-phone service provider, will rely on budding technology known as WiMax to construct a faster, cheaper and more convenient wireless network, Gary Forsee, president and chief executive officer, announced at a press conference in New York.

Sprint Nextel is teaming up with chip-maker Intel Corp. and cell-phone manufacturers Motorola Inc. and Samsung Electronics Co. to develop the WiMax technology, which can provide entire cities with wireless Internet access, unlike short-range WiFi that requires users to be located near a wired “hot spot” such as a cafe or library.

The new high-speed network, the first of its kind, will link the Internet with cell phones, gaming consoles, DVD players and virtually any other consumer electronic device, Mr. Forsee said.

“We will link consumers to consumers and businesses to businesses,” said Mr. Forsee, who touted the possibility of anywhere, anytime access. “Imagine accessing YouTube.com and MySpace.com literally on the fly.”

Mr. Forsee said the company will spend $1 billion in 2007 and between $1.5 billion and $2 billion in 2008 on what he called the “fourth-generation” or 4G network, which will debut in trial markets by the end of next year. In 2008, the network will be deployed across the country and reach as many as 100 million people, he said. Coverage will then continue to expand.

The WiMax network will use Sprint Nextel’s considerable high-frequency radio spectrum holdings. The company’s 2.5 gigahertz spectrum reaches 85 percent of households in the top 100 U.S. markets.

Ivan Feinseth, an analyst for Matrix USA, said WiMax has the potential to be “huge.”

“Eventually, they want to have blanket WiMax in almost every major city,” said Mr. Feinseth, whose company has no business relationship with Sprint Nextel. “There’s going to be WiMax homes and WiMax computers that use that network rather than cell service.”

Mr. Forsee, along with executives from Intel, Motorola and Samsung, described the network as an “ecosystem” that would herald a new generation of consumer electronic devices, each equipped with WiMax chips. In other words, coffee-shop patrons would no longer have to comb through wireless networks and manually connect to the Internet; their laptops would connect anywhere automatically.

Motorola and Samsung will supply mobile devices and equipment as well as infrastructure, executives said. Intel will make the chips.

“Sprint Nextel clearly has a first-mover advantage in terms of establishing what a 4G network actually is and working with the vendors, setting up a wireless technology platform,” said analyst Christopher King of Stifel Nicolaus in Baltimore, which has a business relationship with Sprint Nextel.

The WiMax initiative is the result of more than four years of lab research and consumer testing for Sprint Nextel, which credited several factors for choosing WiMax over other technologies, including speed-to-market and cost-effectiveness.

Still, Mr. King said he is skeptical when it comes to consumer demand for such a network.

“We’ve seen relatively tepid consumer demand for 3G [third-generation] products and services and here we are rolling out 4G,” he said. “I have some question as to whether Sprint Nextel is going to be on the bleeding edge of this technology deployment rather than the leading edge.”

Shares of Sprint Nextel, which has a market cap of $49 billion, closed down 31 cents at $16.63 on the New York Stock Exchange yesterday.


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