Subject: [NEXTEL-1] Sprint Walks and Talks [Motley Fool Take] November 18, 2003

From: [email-masked]
Date: Wed, 19 Nov 2003 12:04:14 -0500

http://www.fool.com/news/mft/2003/mft03111810.htm?source=eptyholnk303100&logvisit=y&npu=y&bounce=y&bounce2=y

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Sprint PCS

By Alyce Lomax

November 18, 2003

Sprint PCS (NYSE: PCS) has joined the ranks of cellular providers that offer a walkie-talkie service, according to news services on Monday. Thank goodness. I'd been waiting for some new craze to replace those darn cellular headsets that make some people around town sound about as nutty as the "Can you hear me now? Good!" guy.

The walkie-talkie move mirrors that of Verizon (NYSE: VZ), which launched a similar service in August. Both Sprint PCS and Verizon's new gadgets aim to compete with Nextel (Nasdaq: NXTL), which has long gone unchallenged in the area. Considering Nextel's 10-year head start, it may be difficult for these new contenders to lure existing customers to their side.

Traditionally, Nextel's walkie-talkie service has been a winner in the corporate market. Its appeal has been to those who work in a variety of industries, such as construction, where there's a need to quickly and instantly connect to others.

Of course, part of the bet here is that walkie-talkie type cellular products could find another lucrative niche. That would be the possibility of a consumer run on such nifty new gadgets, especially with the holidays just around the corner.

Some reports theorized some appeal similar to that of another consumer sensation: instant messaging. While there may be some credence to that concept, one of instant messaging's differentiating characteristics in our hyperactive, multitasking world is the ability to carry on separate, private conversations with several individuals simultaneously (being careful not to type in the wrong window, as I did once when I told a friend in Boston that I would save a table for dinner here in Washington -- whoops).

Conversely, the walkie-talkie idea is for conversations with one individual at a time, or a group. For the consumer, it seems a regular old cell phone would suffice, for the one-on-one conversations. After all, as illustrated by cell phone users chitchatting as they hustle along city streets across the globe, a cell phone bears a striking resemblance to a walkie-talkie anyway.

With wireless number portability a potential drag on subscriber loyalty (and revenues), as discussed recently by Dave Mock, cell providers are obviously scrambling to retain customers and attract prospects. In fact, they would be remiss if they didn't. However, when it comes to this particular product concept, we'll see if "what is old is new again" has an appealing ring.

Are cellular walkie-talkies poised for takeoff, or is a regular cell phone just as effective for most common communication needs? Stroll on over to the Sprint PCS discussion board to share your thoughts.

Alyce Lomax welcomes your feedback at [email-masked].

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