Wireless Merger Favors Lucent, Nortel
An Unstrung article, Deal Solves Nextel 3G Dilemma, says the deal will force Nextel to get off the fence regarding the equipment it will use for 3G developments. It had been weighing different options, but will now adopt the CDMA 1x EV-DO technology already being deployed by Sprint, and that "will play into the hands" of Lucent and Nortel, which could do with a financial fillip (see Nortel's Numbers Disappoint).
The U.S. wireless merger merry-go-round appears to be favoring Lucent most of all. Pat Russo's crew recently snagged a decent chunk of the 3G action from Cingular Wireless, which snapped up AT&T Wireless earlier this year (see Cingular Confirms 3G Trio). As reported last week, the main loser in all of this will likely be Motorola Inc. (NYSE: MOT), which is the sole supplier of Nextel's iDEN network equipment (see Nextel-Sprint: Winners & Losers).
Equipment firms aren't the only parties affected by today's merger news. With Sprint and Nextel set to tie the knot, it now seems unlikely that Verizon Communications Inc. (NYSE: VZ) will upset the apple cart by proceeding with a bid for Sprint, a move many observers believe was little more than industrial mischief (see Verizon's Sprint Bid Faces Hurdles).
— The Staff, Light Reading