On Tuesday Sprint announced that it plans to shut down the iDEN Nextel National Network as early as June 30, 2013, cutting off service for its push-to-talk Nextel phones. The move is part of the company's overall Network Vision plan which is a series of network updates designed to offer next generation network capabilities to customers.
According to Sprint, the Nextel network is being deactivated to make room for more 4G coverage. It's a mere second-generation (aka 2G) network that is unsuitable for smartphones thanks to its low data speeds. However, surprisingly there were 5.4 million phones still active on the Nextel network at the end of March.
Over the last eight months, Sprint has been pushing to transition business and government customers away from the Nextel phones to the Sprint Direct Connect 3G CDMA network by offering four new rugged handsets catering to the push-to-talk crowd. These include the Kyocera DuraMax, Kyocera DuraCore, Kyocera DuraPlus and the Motorola Admiral.
"Sprint will send written notices to business and government customers beginning June 1, 2012 regarding the iDEN Nextel National Network shutdown," Sprint said. "The company will continue to notify customers of favorable offers designed to facilitate a smooth migration to Sprint Direct Connect®. Additional notices are planned for distribution to the iDEN base multiple times over the next year as the shutdown of the iDEN Nextel National Network becomes more imminent."
Sprint also said on Tuesday that it has been approved for a $1 billion line of credit to build out the new 4G network. The credit line is being offered by a syndicate of banks led by Deutsche Bank AG of Germany for equipment purchases from LM Ericsson AB of Sweden. The credit line is backed by the Swedish government's export credit fund because one of Sprint's main vendors is LM Ericsson AB.
"The secured credit facility expires in March 2017 and benefits from a cost of funding of approximately 6 percent provided by AB Svensk Exportkredit and comprehensive insurance cover from EKN, the Swedish Export Credit Agency. Deutsche Bank acted as one of the Mandated Lead Arrangers and as Facility Agent," the company said.