Sprint considers offloading iDEN, the heart of Nextel

US-based wireless carrier Sprint Nextel is contemplating future measures for its iDEN network, which could include its ultimate sale.

Though there were talks several months ago of a "unified service architecture" that would bridge the gap between CDMA, iDEN, and the burgeoning Xohm WiMAX platform, a recent US Securities and Exchange Commission filing from Sprint Nextel shows the company is examining the potential sale of its iDEN network.

Sprint merged with Nextel in 2005, meshing, but not truly combining their respective CDMA and iDEN (Integrated Digital Enhanced Network) technologies. Despite recent growth in the "Push to Talk" feature set that is the cornerstone of Nextel's iDEN, it has long been noted that Nextel customers would eventually be moved to Sprint's CDMA network.

Since the $35 billion 2005 merger, the combined company has been harried by subscriber flight in swelling numbers. This year alone, Sprint Nextel has lost over a million subscribers amid unfavorable press regarding the company's customer service, and technical problems with the iDEN network.

The iDEN network plays a major role in the FCC rebanding effort to help eliminate interference from the public safety and emergency broadcast band. Sprint Nextel currently has until July 2009 to relinquish a 10 MHz portion of its 800 MHz spectrum, used in iDEN, because it has been found to interfere with public safety broadcasts.

Sprint Nextel received an extension from the FCC for its rebanding this June, and since that time has made moves that suggest it seeks to dispose of iDEN rather than continue its course as the company loses money and subscribers.

In the company's recent SEC filing, it says it is "improving operations, making additional investments, entering into strategic partnerships and considering potential divestitures" for iDEN. A letter from CEO Dan Hesse to Sprint Nextel's President of Strategy and Corporate Development Keith Cowan was included as an addendum to the filing. The letter offered a million dollar bonus "upon the board's approval of the strategic resolution of the iDEN network," which Hesse calls "highly confidential."

Analysts have not remarked enthusiastically on the sale of Sprint Nextel's iDEN, looking at it largely as an antiquated and problematic network. Rumors of interested parties, though, have hardly been a scarcity. In March of this year, Merrill Lynch analysts predicted Deutsche Telekom would be interested in buying Sprint. Even as far back as 2005, only briefly after Sprint and Nextel merged, there were rumors that the Department of Defense was considering adopting iDEN for encrypted government wireless communication, but these were never confirmed.