No Strings: Nextel Mobilizes With New Frequencies

Nextel is fast positioning itself as a legitimate challenger to today’s cellular service providers. While recent attention seems diverted to the upcoming personal communications services (PCS), for which frequencies are being auctioned this year by the FCC, Nextel is actively acquiring important frequencies to offer a nationwide service known as Enhanced Specialized Mobile Radio (SMR).

Case in point, Nextel recently announced that it will acquire the SMR frequencies of both Dial Page, Inc. and the remaining SMR frequencies belonging to Motorola. To pay for this, Nextel plans to issue 62 million new shares, and estimates the total of both deals at $2.4 billion.

Nextel’s Enhanced SMR is a digital system that uses the technically sophisticated Code Division Multiple Access (CDMA) system to cram more voice and data signals into a single communication channel. Using the Motorola Integrated Radio System (MIRS) that the company will be supplying Nextel over the next five years, up to ten voice and data sessions can be established per channel.

Following the acquisition, Nextel will be in the position to offer service to a potential audience covering 85 percent of the population of the United States. In terms of coverage, this will bring Nextel in direct competition with the other large nationwide cellular provider, McCaw Cellular, which recently announced that it will be acquired by AT&T.

Nextel was founded in 1987 as Fleet Call, Inc., which reflected its focus on providing wireless communication services for fleet management. In March 1993, the company changed it name to Nextel Communications Inc. with obviously greater ambitions in mind.

Nextel Communications
624 South Grand Avenue
Suite 900
Los Angeles, CA 90017
(213) 312-3000