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NEW YORK |
Wed Aug 10, 2011 3:57pm EDT
NEW YORK (Reuters) - The technology chiefs at corporate customers are slowing down decisions about spending due to economic uncertainty, according to a top executive of Sprint Nextel.
"There's not a panic about spending but they're probably making decisions a little slower than they were a few months ago," Paget Alves, Sprint's head of business services said in an interview with Reuters. "Since the economy is slowing, they need to be cautious."
As well as taking longer to evaluate wireless services, companies also want to make sure that the technologies they do invest in help them to cut costs.
"They're thinking about it in an offensive manner as well as defensively," said Alves.
The executive noted that Sprint was still maintaining its financial 2011 target for operating earnings before interest, tax, depreciation and amortization flat with 2010, even though analysts were hugely skeptical it could meet it.
Sprint shares have fallen nearly 40 percent since July 28, when it announced earnings and its 2011 target, due partly to skepticism about whether it would meet these targets.
Sprint has been losing customers for a long time, particularly from its older Nextel iDen network, which was once hugely popular among business customers because of its walkie-talkie style feature. It will shut down that network in 2013.
On top of dealing with economic uncertainty, Alves will also be tasked with convincing iDen customers to move to Sprint's more modern third generation (3G) network instead of switching to rivals like Verizon Wireless or AT&T Inc.
Alves said he hopes to keep customers by launching three new (3G) phones in October that offer a new version of the walkie-talkie feature as well as other iDen applications.
Alves said the phones, which include one smartphone from Motorola Mobility, will come with promotional incentives but he would not provide details.
Based on current trends, the executive said that he expects most customers to have moved from the iDen network by around the middle of 2013
Sprint shares were down almost 4 percent at $3.15 in afternoon trade on the New York Stock Exchange.
(Reporting by Sinead Carew; editing by Gunna Dickson)
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