Subject: [NEXTEL-1] Flarion Loading is "Lite"800 nonpaying users are testing the service.

From: [email-masked]
Date: Fri, 23 Apr 2004 14:07:58 -0400

Proposed Exchange for Valuable Spectrum Still Pending

By Yuki Noguchi
Washington Post Staff Writer
Friday, April 23, 2004; Page E05

Nextel Communications Inc. announced
yesterday that a boost in sales increased
its net income and revenue, as the
Reston-based wireless carrier reported its
eighth consecutive quarter of profitability.

The company said its first-quarter net
income more than doubled over the
previous year to $591 million (51 cents
per share) on revenue of $3.1 billion. That
compares with net income of $208 million
(20 cents) on revenue of $2.3 billion
during the same period last year.

The company keeps finding ways to add
customers and cut costs, despite facing
stiff competition from other larger carriers,
said Craig Mallitz, an analyst with Legg
Mason Wood Walker, a major
institutional investor in Nextel.
"Predictability in telecom is pretty rare,"
he said.

During the last quarter, Nextel, the
sixth-largest wireless company, focused
much of its marketing effort on its
sponsorship of Nascar, which the
company said is paying off and increasing
its brand recognition. More customers are
using Nextel's walkie-talkie service and
data services, which increased the
average monthly bill of a Nextel
subscriber by $2 over the previous year.

The company also expanded its trial in
North Carolina of a high-speed wireless
service that it has started selling to
customers; so far 800 nonpaying users
are testing the service.

Additionally, Nextel's Boost Mobile
subsidiary, which focuses on marketing
almost exclusively to teens and young
adults, continues to grow. That unit, which
is expanding into seven markets this year
including in the Washington area, added
132,000 subscribers during the quarter
and now has 537,000 customers.

Still pending before the Federal
Communications Commission is a
controversial plan in which Nextel has
offered to pay $850 million to move its
wireless traffic, which the company and
public safety organizations say interfere with public-safety systems, to
another bandwidth in exchange for receiving more valuable spectrum.
Nextel rivals, most vocally Verizon Wireless, have spearheaded a
campaign to prevent Nextel from getting what opponents call a giveaway
of the spectrum, and Verizon Wireless has offered instead to bid at
least $5 billion for the desired spectrum.

"I can say confidently that there is no other plan that satisfies the
FCC's objectives," said Nextel president and chief executive Timothy M.
Donahue in a conference call. Nextel's spectrum-swap plan, he said, is
the only one that eliminates interference, gives public safety
additional spectrum, and funds the transfer of various public and
private parties to prevent interference.
A majority of commissioners have already voted in favor of the broad
outlines of Nextel's plan, but the FCC is still considering asking
Nextel to pay at least $1.3 billion more than its current proposal. The
commission is expected to issue its decision in the next few weeks.

Nextel is also a subject of an antitrust inquiry by the Department of
Justice, which is looking into its walkie-talkie service -- a market
Nextel has dominated for nearly a decade. Nextel General Counsel Leonard
Kennedy declined to comment on the probe during the conference call
yesterday.

http://www.washingtonpost.com/wp-dyn/articles/A35194-2004Apr22.html

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