Prepping for the next wireless boom
Nextel CEO Tim Donahue talks to CNET News.com about the future of the wireless industry and whether his company can make good on its plans in a down economy.
By Ben Charny Staff Writer, CNET News.com May 31, 2000, 2:10 p.m. PT Nextel Communications has a multitalented CEO: He has helped build a company with 8.3 million customers and raised $1 billion in cash from a recent bond sale, and he can spin a cell phone on a tabletop. Tim Donahue can get a Motorola i85 to complete two rotations before deftly scooping it back into his hands and setting it into motion again. It could be a nervous habit or a playful trick, depending on how you see Donahue's current situation in the industry. Next-generation wireless networks face delay after delay, while software glitches have forced the recall of thousands of cell phones this year. At the helm of the company since 1996, Donahue, 52, has been part of the wireless boom that has placed Nextel among some of the largest wireless providers in the United States. Now the company--along with its competitors--is wrestling with the huge cost of introducing next-generation wireless networks while watching shares fall to new lows. In May, the company announced it would cut 5 percent of its work force after missing first-quarter revenue projections. Despite such financial pressures, Nextel says it will add another 2 million customers this year. Donahue recently talked with CNET News.com about the future of the wireless industry and whether Nextel can make good on its plans in a down economy. Q: It seems like every week another telephone service provider is delaying the introduction of its version of the next generation of cell phone service, known as 3G. So when do you see your network reaching 3G? In Europe, 3G licenses are so expensive that one telecom company wants its money back now that the market has soured. You're starting to see a lot of carriers planning to share one network, not build independently. Do you think that's going to happen in the United States? Why hasn't that happened in the United States to begin with? We have a down economy. Will handset sales continue to grow? NTT DoCoMo has recalled at least two sets of phones in the past six months because of software glitches. Analysts are beginning to question whether there's too much software on the new models of phones. What do you think? Motorola has had its troubles. Nextel is aligned pretty tightly with the handset maker. Have you guys felt the pinch? But what happens if their business continues to suffer? Nextel's perspective is more from the corporate side where application is king. What about on the consumer side? Do you think consumers are ever going to adapt to a phone that offers more than just a solid voice connection? |