Sprint Confirms EV-DO Network

Carrier gives $1 billion network the green light and keeps options open on EV-DV

June 22, 2004

2 Min Read
Sprint Confirms EV-DO Network

Sprint Wireless (NYSE: PCS) has confirmed plans to launch a $1 billion CDMA 1x EV-DO (Evolution, Data Only) network, a move flagged by Unstrung last week (see Sprint Chases EV-DO?).

The EV-DO network is intended to crank up data rates to a theoretical 2 Mbit/s, although 300 to 500 kbit/s is a more likely limit.

According to a company statement, the carrier plans to launch services “in select markets in the second half of 2004 and launch in the majority of top metropolitan markets in the United States in 2005.” (See Sprint Opts for EV-DO.)

Sprint spokesman Brian Fries adds, however, that the carrier is not targeting a full nationwide deployment. “It will be across the country but won’t be our entire network. It will be a little different to the way we went from 2G to [CDMA 2000]1x where we flipped a switch and it went on across the country. It won’t be like that. It will be a gradual rollout of markets.”

Fries is unable to specify which regions are targeted for early deployment.

The rollout will benefit Sprint’s current bevy of CDMA infrastructure providers. According to a Merrill Lynch & Co. Inc. research note, Lucent Technologies Inc. (NYSE: LU), Nortel Networks Ltd. (NYSE/Toronto: NT), and Motorola Inc. (NYSE: MOT) dominate supply of the carrier’s network kit (with 40, 30, and 20 percent shares, respectively). LM Ericsson (Nasdaq: ERICY) and Samsung Corp. lay claim to minor stakes (8 and 2 percent).

“We are not bringing anyone new into the mix,” confirms Fries.

The carrier's announcement follows a decision by rival Verizon Wireless earlier this year to launch a nationwide EV-DO network (see Verizon Repeats on 3G).

Sprint's upgrade is a surprise decision in light of the carrier’s previous plans to leapfrog the technology and move directly to EV-DV (Evolution, Data Voice) networks, which also support voice communications (see Lucent Guides Sprint's EV-DV).

Not that Sprint has abandoned all thoughts of an EV-DV deployment: Today’s statement notes that its $1 billion investment plans include “the option for a subsequent, more advanced release of CDMA technology that is expected to be available from equipment vendors beginning in 2006.”

"It appears that the company is using DO as an interim move to improve time to market and its ability to take share in what may become a land grab in the laptop market," notes a UBS research note. "Sprint still expects to make the final step to DV starting in 2006. According to the company, its vendors appear to be giving Sprint excellent terms that allow it to go from DO to DV at roughly the same cost as a direct leap to DV."— Justin Springham, Senior Editor, Europe, Unstrung

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