Sprint Forms M2M Business Unit - InformationWeek

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01:42 PM

Sprint Forms M2M Business Unit

The company sees machine-to-machine products and connected consumer devices as critical to increasing revenue from its data networks.

Sprint Nextel is looking for new ways to use its data networks to generate revenue, and it has formed a new business unit focused on machine-to-machine products and mobile computing services.

Sprint has combined various sales, integration, and business development teams to form its Emerging Solutions unit, which will focus on accelerating the use of its wireline, 3G, iDen, and WiMax networks for businesses. The M2M market involves connecting various machines wirelessly, and it has multiple applications such as remote monitoring, telematics, smart grid initiatives, fleet management, and custom networks for colleges.

The new unit will also focus on providing connectivity for a growing number of consumer devices. Sprint already provides the wireless Internet access for the Amazon Kindle, and the company said consumers will soon expect pretty much all of their gadgets to have mobile data access. Beyond providing the data service, Sprint will also work with partners on hardware and software integration.

Danny Bowman, Sprint's president of integrated solutions, said the market this new unit is focusing on is the fastest-growing by far, but it represents different challenges and opportunities than the traditional cell phone subscriber model. The average revenue per user is far lower and the business models are different, but Bowman said it can be a high-margin market that will only grow stronger as more devices become connected.

As revenue from cellular voice services declines, Sprint is not the only wireless operator looking for other ways to utilize their networks to generate revenue. AT&T and T-Mobile have also targeted the M2M market with smart grid products, and Verizon Wireless is making a big push to provide wireless data for netbooks and e-book readers.

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