Sprint Spins Off Local Communications Company

As of Thursday, Embarq is a free-standing company, allowing Sprint to continue to focus on becoming a voice and data company that will converge wireless and wireline technologies.

May 18, 2006

2 Min Read
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Sprint Nextel officially completed the spin-off of its local communications operations Thursday as the spin-off, Embarq, became a free-standing company and began being traded on the New York Stock Exchange.

Sprint said the spin-off will allow it to continue to focus on becoming a voice and data company that will converge wireless and wireline technologies ranging from its existing cellular business to wireless broadband services.

"With each month since our merger concluded last August, we've announced steps that support our strategy to become a data services company with the ability to erase the barriers between wireless and wireline services for consumer and business customers," Sprint Nextel CEO Gary Forsee said in a statement.

In particular, the company confirmed Thursday that it will select and start deploying a wireless broadband technology as soon as this summer. It has been testing a variety of wireless broadband technologies including WiMAX and UMTS-TDD, a WiMAX competitor developed by IPWireless. Nextel had already tested another wireless broadband technology, FLASH-OFDM, before its merger with Sprint. FLASH-OFDM was developed by Flarion Technologies, which is now owned by Qualcomm.

Sprint said it would spin off its local communications operations when it merged last year with Nextel and officially announced the move last February. Forsee called Thursday's official spin-off of Embarq a "milestone" in that strategy."Our company is now positioned to focus on our vision of converging our unique wireless and Internet wireline assets to create an entirely new suite of mobility and IP-based products and services for our customers," Forsee said.

For its part, Embarq said the spin-off will allow it to better provide its local communications services.

"At the core of our operation is a dependable and reliable communications infrastructure capable of delivering continuously improving levels of service as we put greater emphasis on service delivery, product innovation and customer interaction," Daniel R. Hesse, CEO of the new company, said in a statement.

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