The anticipated merger between Sprint PCS and Nextel Communications Inc. offers an olive branch in one area and a turf battle in another.
The turf battle arises from what the combined company will do with its massive MMDS 2.5 GHz spectrum. Peace dividends redound from one fewer wireless carrier in the competitive U.S. market.
But at play in the 2.5 GHz fallout are companies such as Flarion Technologies Inc., Motorola Inc. and Qualcomm Inc., which either stand to benefit or lose in the technology and contract sweepstakes. Qualcomm wins with its Q-Chat program with Nextel and as a proprietor of CDMA technology.
With the expected Sprint-Nextel merger, Flarion’s Flash-OFDM technology is a major loser with regard to its deployment in the next-generation rollout of Nextel’s networks. Given Sprint’s CDMA commitments, Nextel’s post-merger iDEN roadmap likely will incorporate CDMA technology.
“It’s a win-win for CDMA,” commented Andrew Seybold of the Andrew Seybold Group.
“This merger may pose challenges for Flash-OFDM,” said Ozgur Aytar, senior analyst with Pyramid Research.
Flarion believes it is enjoying momentum around the world. A major European carrier, T-Mobile International, has begun trials of Flash-OFDM technology. Flarion said a few other operators it would not disclose already are working on the technology.
Flash-OFDM technology already is partnering with Motorola systems in the public safety area, besting other players like Lucent Technologies Inc.’s CDMA offering in the Washington, D.C., area. Nortel Networks Ltd. is trialing Flash-OFDM in the Raleigh, N.C., area as well. Flarion already is making chips for wireless devices, including laptops.
In addition, a combined Sprint Nextel would hold 2.5 GHz MMDS spectrum in the top 100 markets in the country and covering 85 percent of the U.S population. The new company would hold 90 percent of the 2.5 GHz MMDS spectrum.
Sprint will use the 2.5 GHz spectrum for advanced services, which brings into play some of the big broadband technologies. And Flash-OFDM has a chance at 2.5 GHz among other players, which could include WiMAX, HSDPA and IPWireless’ TDD-UMTS technology.
“Sprint will continue to experiment with different technologies on the 2.5 GHz band (as it has with the Flarion trials in Virginia) and conduct more trials in other areas to build out a system that can be used for `innovative’ wireless communications services,” commented Seybold.
Building a network on that band will require more cell sites, which means greater cost to the operator, according to analysts.
Analysts also are suggesting Motorola’s iDEN and next-generation WiDEN technologies come out losers as their years are numbered. But this is a limited loss as the company may play into the next-generation contract bids for the CDMA overlay. Motorola offers CDMA as well as UMTS technology, so it can flex its muscle when the combined company begins work on upgrading the Nextel networks to bring homogeneity to the networks across the country.
And for the immediate future, Motorola announced last week it has signed a three-year agreement to extend its supply of iDEN infrastructure equipment to Nextel beginning Jan. 1. Both companies also agreed to implement an iDEN-based Internet Protocol-based Push-To-Talk call-processing engine known as Next Generation Dispatch.
Some industry watchers have expressed doubts over the future of iDEN technology in Nextel’s roadmap, but this deal shows that it will take a few more years before the carrier does away with the technology. In fact, both Sprint’s and Nextel’s networks are expected to interface painlessly, even when Nextel upgrades to WiDEN, said the companies.
Now that Motorola has stepped up it core offerings, it is likely to be an important player in the new network, according to analysts.
The company also said more new models of iDEN handsets will reach the market during the next 12 months, and some others will incorporate WiDEN data functionality, which increases data rates by up to four times compared with currently available iDEN handsets.
The company’s PTT announcement also underscores its efforts to put behind it its reputation as a radio-only company, which crippled its capacity to garner some contracts. In the past quarter, it beat all other major vendors in terms of the percentage of overall wireless infrastructure contracts won.
“We now want to be seen as a company of seamless mobility,” said Eduardo Conrado, senior director of global marketing at Motorola.
