In time for the 2010 holiday season, Sprint Nextel Inc. (NYSE: S) says it plans to release a variety of business and consumer wirelessly-connected gadgets that it hopes will bring new profitability to the wireless phone company. The company was not specific about the new devices other than to say they could include a device for health applications and consumer goodies like tablets, e-readers, and gaming devices.
This represents another effort by Sprint to boost profits at a time when the company is losing contract customers. The rollout of the company’s 4G network, set for next month, aims to draw customers from AT&T (NYSE: T) and a recent deal with Wal-Mart Stores Inc. (NYSE: WMT
) to offer a low-cost pre-paid calling plan. Also, the Apple iPhone 4 will make its sales debut at Walmart.
This latest foray into embedding wireless in a variety of gadgets appears to be aimed squarely at recouping some market share from AT&T and its customers for the iPhone from Apple Inc. (NASDAQ: APPL). What’s a little hard to fathom about the new gadgets is how they will be better than a slew of apps running on the iPhone and other smartphones such as the new HTC EVO 4G that Sprint recently released.
Back in the day, a well-equipped business traveler carried a cellphone to make calls, a PDA to keep track of daily tasks, and a laptop to keep in touch with the home office. All these chores can now be completed with a smartphone, or if one needs to write long documents, an inexpensive and lightweight laptop or netbook.
Apple’s new iPhone 4 also includes functionality for game playing and reading electronic books. The Apple answer to all the gadgets is software apps. There’s something pretty compelling about that story when compared to stuffing a briefcase with a handful of devices that can now communicate. Really, so what?
It’s probably a bit harsh to fault Sprint’s plan without more detail about the devices it plans to connect and what the benefits will be. Still, on first blush, this doesn’t seem like it’s the plan that will jack up Sprint’s profits substantially.
Sprint’s shares are trading down about 2% this morning.
