Nortel, Lucent Line Up for Sprint Wireless Data Deal

Sprint (FON Quote) is preparing to unveil its much-anticipated wireless data plans at an industry technology show Tuesday morning, according to people familiar with the company.

The Overland Park, Kan., telco is expected to announce that it has chosen a wireless transmission standard known as evolution data only, or EV-DO, to upgrade its network and offer fast Internet access to its cell-phone and laptop subscribers. Sprint has apparently scheduled the announcement for Tuesday morning at Supercomm, a trade show in Chicago. Sprint was not immediately available for comment.

Sprint joins Verizon Wireless -- a joint venture between Verizon (VZ Quote) and Vodafone (VOD Quote) -- as the second telco to choose EV-DO as its so-called third generation, or 3G, technology strategy. Rival Cingular, a joint venture between SBC (SBC Quote) and BellSouth (BLS Quote), is testing a different technology known as universal mobile telecommunications system, or UMTS.

The big three wireless shops are in an arms race of sorts, attempting to enhance their networks for high-speed Net delivery in the hopes of capturing new revenue beyond calling and short messaging services.

Sprint is expected to spend about $700 million over the next two years on new EV-DO gear, according to a recent Merrill Lynch report. Industry observers expect that Sprint will likely divvy up most of the money between infrastructure suppliers Lucent(LU Quote) and Nortel(NT Quote).

Similar to the Verizon Wireless deal, Nortel will likely get picked to install the EV-DO gear on its existing network equipment throughout the Sprint network. And Lucent will probably get slightly more of the business, since its equipment is spread over a larger portion of the Sprint coverage area.

Merrill estimates that Lucent gear represents about 40% of Sprint's wireless map, with Nortel at 30% and Motorola(MOT Quote) 20% of the network footprint.

Sprint had previously said it was interested in evolution data and voice, or EV-DV, since that technology would expand both voice and Internet capacity. But EV-DV wasn't immediately available or at least suitable to Sprint's liking, according to one analyst.

One of the downsides to the EV-DO technology is that it robs a wireless network of some of its voice capacity. Though Sprint has only the fourth-highest subscriber total, it does a big business in wholesale wireless as a supplier to Qwest (Q Quote) and Virgin Mobile.

In his report Thursday Merrill Lynch analyst Tal Liani wrote that he expects Sprint to start offering its EV-DO service in the first quarter of next year.