NEW YORK (Reuters) - Sprint, the No. 3 U.S. mobile provider, plans to use an emerging wireless technology to compete head-on with cable providers and other broadband Internet rivals in about three years, the company's vice president of technology development said on Tuesday.
Sprint plans to build city-wide mobile networks with speeds comparable to today's wireline home Internet links by using WiMax, a wider-range radio technology than Wi-Fi, the wireless system popular among laptop users in coffee shops.
"With that kind of bandwidth it would allow us to offer a whole new range of capabilities to our customers," said Oliver Valente, who expects Sprint to start selling WiMax by 2008.
In-stat analyst Eric Mantion predicts it would cost about $3 billion to build a WiMax network. Valente declined to estimate but said he thought the $3 billion figure was high.
But mobile WiMax still faces hurdles, including agreed upon technical standards. Sprint plans this year to test early WiMax products that will be capable of wirelessly linking home or office computers to the Internet but will not provide WiMax commercially until a mobile standard is ready, Valente said.
Sprint, which will have airwave licenses suitable for WiMax in 80 of the top 100 U.S. markets after it buys Nextel Communications Inc. this year, believes a mobile version of WiMax will be more convenient to customers than cable modems or Digital Subscriber Lines (DSL), a broadband service run over copper phone lines.
"What that would allow you to do is offer cable modem or DSL-type services that people can take on the move with them," said Valente.
This will pit Sprint's WiMax services for consumers and business against DSL operators such as Verizon Communications and SBC Communications and cable operators Comcast and Time Warner Inc.
Using WiMax, Sprint plans to compete for consumers with services like speedy music and video downloads to phones. It also hopes to use it to win business customers by replacing traditional phone and data links to offices, Valente said.
Sprint also could use WiMax to extend its network and save on operating costs by linking its wireless broadcast towers to each other instead of using traditional wireline links that are often rented from rivals, Valente added.
Some analysts have predicted that early versions of WiMax could already prove to be popular alternatives to existing technology but Valente said he believes that only the mobile version of the technology makes economic sense.
"I think there is a lot of hype in the fixed WiMax space," said Valente. "The mobility aspect is critical."