Subject: [NEXTEL-1] Nextel Keeps Flarion Waiting

From: [email-masked]
Date: Thu, 22 Apr 2004 15:26:04 -0400

Unstrung.com

Nextel Keeps Flarion Waiting 
04.22.04

Nextel Communications Inc. (Nasdaq: NXTL - message board) today 
admitted that it's in no hurry to extend its Flash-OFDM trial with 
Flarion Technologies, despite analysts' beliefs that a nationwide 
rollout of the technology is the carrier's most likely path to high-
speed wireless broadband services.

Earlier this month, the U.S. carrier ramped up its North Carolina 
trial with the startup, announcing plans to charge users for the 
service in an effort to provide a real market test for the technology 
(see Nextel Steps Up Data Race and Nextel Flashes With Flarion).

During its first-quarter results announcement today, however, Nextel 
chief operating officer Tom Kelly stressed that no decision is 
imminent on its future plans for large-scale wireless broadband 
rollout (see Nextel Boosts Revenue).

"The early results of our trial are promising, but there is much work 
to be done to enhance and understand its performance, customer 
demands, and the spectrum bands in which it can be utilized."

Kelly also left the door wide open for other "alternative wireless 
broadband" vendors to stake their claim. "Nextel continues to 
evaluate other broadband technologies, particularly as they apply to 
the 2.5GHz band. I want to be perfectly clear when I say that no 
broadband decisions have been made to build out the next-generation 
network at this time."

Despite Kelly's comments, some financial analyst reports claim it is 
only a matter of time before Nextel commits to a nationwide rollout 
of Flash-OFDM. "We are assuming that Nextel will move forward with a 
3G/Flarion buildout, and that the company will spend $2 billion to $3 
billion in capex/opex over a three-year period," note analysts at 
Thomas Weisel Partners.

"Such a move would put the company in very good position to compete 
with Verizon Wireless' 1x EV-DO network and be ahead of the game 
potentially versus PCS and T-Mobile, as well as the 
combined/distracted AT&T Wireless/Cingular" (see Verizon Repeats on 
3G and Cingular Buys AT&T Wireless).

Signals Research Group concurs: "SRG believes Nextel will deploy 
Flash-OFDM nationwide, assuming it receives its 1900 MHz, in order to 
counter VZW's rollout," writes the company's Michael W. Thelander 
(see Verizon Calls for Auction).

OFDM is a modulation scheme that can support an average data rate of 
around 1.5 Mbit/s for users in a standard, PCS-sized cell site, using 
only 1.25 MHz of spectrum. It is approximately four times more 
spectrally efficient than comparable 3G technologies.

http://www.unstrung.com/document.asp?doc_id=51507

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