Sprint PCS’ recently launched Ready Link walkie-talkie service drew mixed performance reviews last week from industry analysts who noted that while the service was superior in many ways to Verizon Wireless’ similar Push-to-Talk offering, it fell short of Nextel Communications Inc.’s Direct Connect service, which most note represents the industry standard.
Bear Stearns & Co. Inc. telecommunications analyst Phil Cusick found in head-to-head testing between the Sprint PCS and Verizon Wireless services that it took an average of 5.6 seconds for a Ready Link user to be alerted that he could begin speaking compared with nearly eight seconds for a Verizon Wireless Push-to-Talk user.
Cusick also noted in his testing that the Ready Link service typically alerted the call initiator that he could begin talking as much as two seconds before the call receiver was alerted, while the Verizon Wireless service usually alerted the receiver prior to allowing the call initiator to begin speaking.
This was partially explained by Sprint PCS’ use of buffering software that allows users to begin speaking before the session is finished setting up and is one of the main differences between the two carriers’ services, which both use Motorola Inc.’s Winphoria platform.
Jonathan Atkin, telecommunications analyst at RBC Capital Markets, reported similar differences between the two services, noting Ready Link call setup of between two and 2.5 seconds compared with in excess of seven seconds using Verizon Wireless’ service.
Atkin noted that because call setup usually occurs only once during a session, the difference was not a huge factor, but it still “represented one more performance criterion in which [Sprint PCS] measures up better than [Verizon Wireless].”
Intra-call latency measurements were closer, with Bear Stearns reporting Ready Link was consistently one second faster than Verizon Wireless’ service, while RBC’s results showed up to a two-second advantage for Sprint PCS on what it called “round-trip intra-call latency.”
Sprint PCS also garnered praise for its handset selection, which initially includes a pair of color-screen Sanyo handsets compared with Verizon Wireless’ single no-color-screen Motorola handset, an easier user interface and increased reliability.
“Our overall impression of the Sprint phone was positive, and we found that the Sprint Sanyo SCP-7200 had a friendly user interface, better voice quality and user-impression latency, and was far easier to use than Verizon’s Motorola V60p,” Cusick said.
RBC’s Atkin added that Sprint PCS’ superior performance should help drive higher demand when compared with Verizon Wireless’ service, which the nation’s largest carrier reported during the third quarter had reached 100,000 subscribers since the Push-to-Talk launch in mid-August.
“Based on how the PCS Ready Link product currently performs, coupled with its handset selection and pricing, we believe the company will see a stronger ramp in PTT penetration than [Verizon Wireless],” Atkin said.
While the Ready Link service received generally positive performance reviews, the service launch was not without its flaws as the planned Web-based interface allowing customers to manage their contact list was not operational for the Nov. 17 launch. The interface option was included in Ready Link promotional material, handset owner manuals and in the product’s press release.
“I don’t think it’s a huge issue long term, but it could generate higher levels of customer service calls at a time when those agents should be concentrating on other issues like LNP and activating new customers around the holiday season,” explained Adam Guy, senior analyst of wireless and mobile services at the Yankee Group.
Sprint PCS said last week that the service was available for enterprise customers, but individual customers would have to wait until January before being able to manage their contact lists from the Internet.
Despite acclaim for the Ready Link offering compared with Verizon’s service, analysts noted both failed to match Nextel’s offering, which provided both sub-one-second call setup and intra-call latency in comparison testing.
“The threat to Nextel is growing, but at this early stage, the threat is more on acquisition than on retention,” said Jeffrey Kagan, an independent telecommunications analyst.
Though it’s no longer the lone nationwide carrier offering a walkie-talkie service, Nextel appeared unfazed by the new competition.
“Our business has not been remotely affected by this,” said Nextel chief executive officer Tim Donahue at a UBS Warburg investor conference last week.
Nextel is also expected to increase the push-to-talk pressure with plans to launch its Direct Connect service in Mexico, Brazil, Argentina and Peru during the second quarter of next year with former subsidiary NII Holdings Inc., as well as a deal to sell the service in Canada where Telus Mobility currently offers the Mike iDEN-based service.
