Nextel ( NXTL) investors felt a chill as federal antitrust officials turn some attention to the walkie-talkie market.

Shares of the Reston, Va., cell-phone service provider fell 72 cents, or 2.7%, to $25.70 Thursday as Nextel complied with a Justice Department request for information. Rival Verizon Wireless and equipment supplier Motorola ( MOT) also were reportedly supplying documents to the antitrust division heading the DOJ inquiry.

The regulators are focused on Nextel's signature "push-to-talk" two-way radio technology, which has been instrumental to the company's success in niche markets like fleet dispatching and technical team coordination. Notably, Verizon and Sprint PCS' ( PCS) effectiveness with their own walkie-talkie feature has been limited and judged technologically inferior.

Observers say there may be any number of antitrust issues involved, including a legal interest in the terms of a recent settlement reached between Nextel and Verizon, or the potential collusion between Nextel and Motorola to bar rivals from the market and even one presumed parallel to AOL's former monopoly of instant messenger communication.

Whatever the case, Wall Street is well aware that Nextel's walkie-talkie feature is a vital edge in one of tech's most competitive markets. The direct connect function has helped Nextel achieve industry-leading customer loyalty, the highest revenue-per-user levels and strong profit as some peers flail away simply trying to add more subscribers than they lose.

Representatives at Nextel and Motorola would only say their companies cooperated with authorities. A DOJ spokeswoman had no comment, and a Verizon rep did not immediately return calls for comment.

But while the participants were mum, analysts and industry experts were busy offering cautions and speculation.

The antitrust inquiry was part of the rationale for CSFB analyst Lara Warner's downgrade of Nextel on Thursday. Warner lowered her rating to neutral from buy, citing Nextel's high valuation and downside risk to the company's dominance of push-to-talk.

And in a note to clients Thursday, Bear Stearns analyst Phil Cusick suggested that Nextel's direct connect subscribers could represent a walled garden of sorts, akin to the millions of AOL IM users. As part of the conditions of the merger between AOL and Time Warner ( TWX), the Federal Communications Commission required AOL to create an industry standard for IM, opening the doors to competing services as the technology evolved.

Antitrust experts said they doubted Nextel's dominance of direct connect represented a monopoly, but they point out that when Motorola and Nextel joined forces in push-to-talk in the mid-'90s, the DOJ intervened to assure that rivals wouldn't be blocked. Regulators resolved the matter by limiting Nextel's two-way radio spectrum and reserving space for competitors.

Former Justice Department attorney Charles Biggio isn't surprised to see the antitrust folks involved again.

"They've had some interest in this market for a few years. And they clearly seem to be monitoring the competitive issues," said Biggio, at attorney with Akin Gump Strauss Hauer & Feld.

Biggio says the DOJ may simply want to know the terms of the settlement reached between Verizon and Nextel. Last summer, Verizon sued Nextel accusing the No. 5 wireless company of using two prototype "push-to-talk" phones to gather sensitive information about Verizon's network operations.

Given the growing importance of the walkie-talkie feature, the Justice Department is likely to try and squash any exclusive arrangements between controlling players. Nextel, the walkie-talkie standard bearer, has more than a little at stake, no matter what the outcome.

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