Sprint Nextel chairman to retire at year-end

Tim Donahue, former president and CEO of Nextel Communications, to step down at the end of the year.

Sprint Nextel, the third-largest mobile operator in the United States, said on Tuesday that its chairman, Tim Donahue, will retire at the end of the year.

Donahue, 57, is the second high-level official to leave the company in the past few months. Len Lauer, Sprint Nextel's chief operating officer, resigned in August. A replacement for Donahue has not yet been named.

Tim Donahue Tim Donahue

Sprint also announced that Robert Bennett, former CEO of Liberty Media, had been appointed to its board.

Donahue, a telecommunications veteran, was president and CEO of Nextel Communications before it merged with Sprint. After the deal was completed last year, Donahue stepped into the role of executive chairman of the board.

"I have poured my heart and soul into Sprint Nextel, and I am confident that the promise of the merger will be realized," he said in a statement. "Instead of being in the thick of the action, it's time for me to start cheering Sprint Nextel along from the sidelines."

Sprint has been struggling recently to keep up with competitors Cingular Wireless and Verizon Communications. These companies have added more new subscribers than Sprint in recent quarters while also keeping a higher percentage of existing customers. As a result, Sprint suffers from a higher "churn rate" than its two main competitors.

Meanwhile, Sprint Nextel has been pouring money and other resources into new initiatives to differentiate itself from its competitors. Last year, the company scored a deal with four cable companies to offer services that combine mobile-phone features with cable TV and broadband services. The joint venture has been slow to get off the ground, but some services are expected to be rolled out later this year or early next year.

Sprint has also spent more than a billion dollars upgrading its network to handle wireless broadband service. It is currently upgrading its third-generation network built on a technology called Evolution Data Optimized, or EV-DO, to a faster version of the technology called EV-DO Revision-A.

In August, Sprint revealed that it will spend more than $3 billion in the next two years to deploy a fourth-generation network based on a technology called WiMax.

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