Sprint + Nextel = SprinTel

Boy this one happened fast: Sprint and Nextel are merging and creating the third largest wireless carrier in the country. And with their combined spectrum and wireless assets, the two will be worthy challengers to the new bulked up Cingular and Verizon Wireless. The deal, according to Wall Street Journal is worth $36 billion. Here are some of the specifics of the deal: the post merger will spin-off its local phone business, and become a pure play wireless company. The spin-off will be based in Overland Park, Kansas, while the wireless company will be based in Reston, Virginia. Sprint Chief Executive Gary Forsee will retain the job at the wireless company, to be called Sprint-Nextel. Nextel Chief Executive Timothy Donahue would serve as executive chairman of the new company. The company would have a 50-50 split among board members, the Journal adds.

Some possible things to ponder about: This clearly is a big win for the CDMA technology and Qualcomm. I am sure they must be popping champagne down in San Diego. Secondly, this cannot be good for our friends at Flarion, which has been running trials with Nextel down in North Carolina. In addition, not such good news for Motorola which has been selling a lot of IDEN handsets and other gear to Nextel. They will get a nice chunk of change as a result of this merger, since Motorola does have investments in Nextel.
Reuters reports that deal is unlikely to get as much scrutiny as the $41 billion buyout of AT&T Wireless by Cingular. Still many fear that as the industry consolidates, the consumers are going to suffer and expect the prices to nudge up. Still there are four players in total, so the prices are not going to get out of whack! I do feel that the service is going to improve, because most of the carriers now have ample spectrum to support better voice and the third generation of services.