Sprint Nextel extends iDEN deal with Motorola through 2013

To the surprise of few, Sprint Nextel Corp. (S) this morning announced an extension with Motorola Inc.’s (MOT) Solutions business to provide support for the carrier’s iDEN network through the end of 2013. The three-year extension lines up with the carrier’s previously announced plans to begin phasing out its iDEN network beginning in 2013.
Motorola, which developed the iDEN technology as a way for then Nextel Communications Inc. to deploy cellular services using its fragmented spectrum holdings, has remained the only supplier of iDEN-based technology and equipment. The technology continues to set the standard for push-to-talk performance that is favored by a number of enterprise markets.
Financial terms of the extension were not released.
As part of its Network Vision initiatives, Sprint Nextel said it plans to begin using some of its rebanded 800 MHz spectrum that is currently exclusive to its iDEN network to enhance its CDMA network coverage. In addition, Sprint Nextel has said it plans updates to its CDMA technology that will allow it to offer PTT services matching the performance of its iDEN service and paving the way for the eventual shutting down of its iDEN network. The carrier had previously launched an update to its CDMA network using Qualcomm Inc.’s QChat technology that allowed for PTT interoperability between CDMA and iDEN devices, but has since stopped promoting the so-called “PowerSource” offering.
Sprint Nextel has previously used its iDEN network to launch its Boost Mobile prepaid service that has since begun transitioning to its CDMA network.
Since Sprint Corp.’s acquisition of Nextel in 2004 the carrier has steadily lost customers from its iDEN network.
However, until then, Sprint Nextel said it plans to continue supporting its iDEN network. That support includes plans to roll out new devices during the first quarter of next year. Those devices include the i886 ruggedized device that will sport a slide-out QWERTY keyboard and the i686 that can be immersed in a meter of water for up to 30 minutes. No word as to whether the device will hold a call for any amount of time under water.
Motorola announced the extension of its iDEN support for NII Holdings Inc. in October. That deal runs through 2014 and covers the supply of hardware, software and services to NII Holdings’ networks in Argentina, Brazil, Chile, Mexico and Peru. Motorola noted that its proprietary iDEN technology is currently being used by more than 30 network operators in 24 countries.
Motorola is planning on splitting its business in two at the beginning of 2011. Following the split, Motorola’s current Mobile Devices and Home businesses will become Motorola Mobility Holdings Inc. and trade on the New York Stock Exchange under the “MMI” ticker symbol. Current co-CEO Sanjay Jha will become CEO of Motorola Mobility.
The remainder of Motorola’s current operations, which is focused on providing communication solutions to government, public safety and enterprise customers, will become Motorola Solutions Inc. and trade on the NYSE under the “MSI” ticker symbol. Current co-CEO Greg Brown will be president and CEO of Motorola Solutions.
Motorola’s current networks business, which is in the process of being sold to Nokia Siemens Networks, will revert to the Motorola Solutions business should the sale not be completed before the split.