Carrier Channel: Qwest Taps Sprint Wireless Network

Posted: 9/2003

Qwest Taps Sprint Wireless Network




By Josh Long

Qwest Communications International Inc., the fourth largest local
phone company, has signed a wholesale agreement with Sprint Corp. to lease its
nationwide wireless network.

The pact allows Denver-based Qwest to provide wireless voice
and data services to residential and business customers across the country.
Under the deal, Qwest will offer Sprints advanced wireless data service, PCS
Vision, the companies say.

The agreement stipulates Sprint will be an exclusive
third-party provider of wireless services to Qwest. The phone companies say they
are developing a plan to migrate Qwest customers to the Sprint PCS network.

Qwest, which provides local phone service in 14 states from
Iowa to Washington, says it plans to introduce calling plans early next year
incorporating nationwide coverage.

Independent analyst Jeff Kagan says the agreement between
Qwest and Sprint PCS benefits both carriers. Qwest gets a proven, brand name, national wireless voice
and data offering for their customers and Sprint gets a truckload of new
customers and revenue out of the deal, says Kagan. Qwest needed a credible
wireless offering because companies are increasingly competing on the bundle of
local, long distance, Internet and wireless. This allows them to remain competitive as that marketing
dynamic changes.

Qwest says its customers have the option of retaining many
current features, including a so-called one-number service allowing people to
use their wireless number as their home or office number too.

The pact is representative of the industrys movement to
round out a communications package with wireless service and stay competitive
with the regional Bell operating companies. Adam Guy, a senior analyst with The
Yankee Group, says cable operators may be the next companies to strike a
wholesale agreement with wireless carriers. I think cable companies are a
strong target for this, he says.

Earlier this year, AT&T Corp. announced plans to resell
wireless service from AT&T Wireless, the company it spun off in July 2001.

Although AT&Ts chief rival MCI shed its wireless resale
business last year, chairman and CEO Michael Capellas told Bloomberg
News in a May interview the company has held high
level talks with some wireless carriers. An MCI spokesman declined
comment.

Guy says MCI has more pressing matters to resolve
specifically the proposal of the General Services Administration to bar MCI from
receiving new federal contracts for up to three years. Until a final decision is
made, MCI is not eligible to receive new federal contracts. MCI chairman and CEO Michael Capellas told reporters MCI
generates 6.3 percent of its business through the public sector, but he declined
to assign a dollar value.

Until that [GSA] situation is squared away, nobody is going
to want to partner with MCI, says Guy.