Sprint Nextel contemplating Leap, MetroPCS competitor

Sprint Nextel Corp. plans to target the growing prepaid/sub-prime wireless market by launching an unlimited local calling service through its Boost Mobile L.L.C. sub-brand, CEO Gary Forsee told analysts at a conference hosted by Citigroup.
Although Boost has run on iDEN historically, the local calling service will use Sprint Nextel’s CDMA network. Forsee said that the company would look at adding the service in markets with extra CDMA network capacity, and probably in places that other flat-rate carriers such as Leap Wireless International Inc. and MetroPCS Communications Inc. do not currently offer service.
“We would be fulfilling a gap in our product offering and we would be doing that in a very precise way,” said Forsee, who added that the segmentation and cost structure would have to be handled carefully, but would allow the carrier to “take advantage of what we see as an emerging trend.” While there might be concerns about a flat-rate unlimited service cannibalizing Sprint Nextel’s other products, he said, a lower-cost service might be the right answer for keeping customers who otherwise would be likely to churn to other service providers.
Sprint Nextel also plans to focus much of its energy this year on taking care of business customers, particularly its iDEN users, “Our concentration in 2007 will certainly be disproportionate to business,” Forsee said, citing the CDMA data capabilities which will be made available to iDEN business users once the carrier launches its dual-mode iDEN/CDMA phone nationally next week.
Sprint Nextel also plans to ramp up the number of markets in which it offers wireless service in partnership with four cable companies. Forsee noted that the carrier is still in discussions with the cable operators about a framework for them to eventually take advantage of the carrier’s planned WiMAX network.