Sprint and SK Telecom Talk In Troubled Times

July 16, 2008

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SK Telecom of South Korea is at it again. They have previously attempted to buy an ownership stake in Sprint Nextel but Sprint had rejected the 5 billion dollar offer. This time around the companies are purportedly only interested in a “partnership” arrangement with a potential minority investment by SK Telecom.

Sprint has had a rough year

This has been a rough year for Sprint Nextel which has struggled to keep and grow its customer base in the wake of the lackluster Nextel merger. The slow erosion of the traditional landline telephone business as customers switch to Cellular and Voice Over IP, has placed additional pressure on Sprint to outperform on the Cellular side. However, tough economic conditions and a gathering loss of Nextel customers has led to an over all loss of Sprint Nextel customers and has made it difficult for #3 Sprint to compete against its larger rivals AT&T and Verizon.

It is unlikely that an SK Telecom partnership or possible merger would provide the new and groundbreaking products which might change the fortunes of either company, but it would allow SK Telecom a greater presence in the United States and potentially help prop up Sprint for the next round in the telecom wars.

Written by Todd · Filed Under Mobile, Telecom