Sprint Nextel plans on forging partnerships with companies to promote embedded wireless technology, as it looks to expand its revenue streams beyond traditional cell phone service, according to a report in the Wall Street Journal.
The report, citing a person familiar with the matter, said that Sprint was in talks with GPS company Garmin, Kodak and memory storage company SanDisk to supply embedded wireless Internet service for their products. Sprint would allow the companies to use its wireless service, and collect fees based on the amount of data transmitted, but would not be in charge of billing and customer service for the devices.
Sprint CEO Dan Hesse recently indicated that the company was looking to try to gain a competitive edge by moving further into the wholesale business. "(Wholesale) is an important contributor to revenue now, and will be an important contributor for some time," Hesse said in an interview with the Journal. "We'll get the lion's share of new products that need a cellular connection."
The move would make sense for Sprint, as it looks to boost revenues amid a declining subscriber base. Though wholesale subscribers make up a tiny fraction of its revenue, the segment has grown 27 percent to 8.1 million subscribers since 2006. Sprint currently has around 49.3 million subscribers. Other wireless companies, such as AT&T Mobility, Verizon Wireless and T-Mobile USA have also recently emphasized embedded wireless business models and partnerships. FierceMarkets will be hosting a panel on embedded wireless at the "Path to 4G" co-located conference at CTIA Wireless 2009 in Las Vegas next week. Panelists include Tony Lewis from Verizon, Glenn Lurie from AT&T and Todd Rowley from Sprint. See agenda here.
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