Sprint CEO Hesse: M2M Key to Companys Growth

COMPTEL PLUS — Sprint Nextel Corp. (S) CEO Dan Hesse is looking to machine-to-machine (M2M) technologies to fuel much of his company’s growth in the next few years.

Revenue from that burgeoning market is projected to soar 250 percent by 2013, Hesse said on Monday evening at the Fall 2009 COMPTEL PLUS Conference & Expo in Orlando. Sprint, he added, expects to lead its peers in the M2M arena, which ranges from smart grid initiatives to vehicles to e-books. Current partners include Ford Motor Co.

But M2M is just one area where Sprint is working to increase revenue. The service provider has fallen behind in launching innovative mobile devices, for example; this year, however, Sprint has worked hard to reverse that trend with the introduction of 16 new touch-screen phones, Hesse said.

It’s also relying on developers to create applications for its devices. Sprint, he noted, has an “open philosophy with no undue restrictions.”

“We consider developers an essential creative force for mobility,” Hesse said.

Sprint is diving into other waters as well. For instance, it’s tackling the wholesale market with femtocells, VoIP and wireless products and services. And wireless is perhaps the most important piece of Sprint’s growth opportunity. Before that can happen, though, telecom regulations need to be fixed, particularly the intercarrier compensation and special access regimes, said Hesse. Those rules subsidize outdated LECs and services, he said.

Part of the impending regulatory changes that could impact Sprint are coming from the FCC right now. FCC Chairman Julius Genachowski has declared his intent to impose net neutrality regulations to keep operators from blocking and controlling content. Hesse said he wants to avoid “any unintended consequences,” especially when it comes to network management.

“The antithesis of open is clogged,” he said.

Users of the Slingbox video appliance, for example, can take down an entire cell site just by forgetting to disconnect the devices. Hesse said Sprint will work with the FCC to ensure that, relative to net neutrality, the many are not harmed by the few.

Finally, Hesse said Sprint has no plans to pursue a video strategy that would pit the carrier against AT&T Inc. and Verizon Communications Inc. The company is happy being tops in 4G, he said, and working with cable operators and MVNOs to boost its strength in voice, data and wireless.

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