Sprint bought Nextel for $36B and wrote off $29.7B in three years

In August 2005, Sprint Corporation and Nextel Communications merged in a $36 billion deal that was supposed to create a wireless powerhouse capable of challenging Verizon and AT&T. The combination brought together Sprint's nationwide CDMA network with Nextel's iDEN push-to-talk network and its valuable spectrum holdings. At closing, the combined company had 54 million subscribers and was the third-largest US wireless carrier.

The merger unravelled because the two networks were fundamentally incompatible. Sprint used CDMA; Nextel used iDEN. The promised integration never materialised, and the company spent years trying to bridge the gap with hybrid devices that satisfied neither customer base. The cultural clash was equally severe — Nextel's top executives left within two years, and the dual headquarters in Reston, Virginia and Overland Park, Kansas reinforced the divide. In 2008, Sprint wrote off $29.7 billion of the $36 billion acquisition price, acknowledging Nextel was worth only 20% of what it had paid.

The iDEN network was finally shut down in 2013, and Nextel's Direct Connect service was migrated to Sprint's network, ending the integration nightmare. By then the damage was done: Sprint's customer churn was the highest in the industry, and the company had fallen permanently behind Verizon and AT&T. In 2013, SoftBank acquired a majority stake, and in 2020 Sprint was acquired by T-Mobile US, ending the brand's independent existence.