Wireless Carriers

A federal appeals court cleared the way Tuesday for the Federal Communications Commission to allow new area codes exclusively for cellular phones and pagers, rejecting industry arguments that the practice may unfairly burden wireless carriers and their customers.

Wall Street bid up shares in mobile phone providers Wednesday in anticipation of increased cell phone sales and subscriptions because of last week's terrorist attacks. Wireless phone companies AT&T Wireless Services Inc., Sprint PCS Group and Nextel Communications Inc.--three of the nation's largest carriers--saw their shares close up 3% to 7% on Wednesday. Sprint PCS rose 90 cents to $24.78, AT&T Wireless jumped $1.

Wireless provider Nextel Communications Inc. provided a rare dose of good news for the telecommunications industry Tuesday, surprising investors with its first quarterly profit and a higher full-year earnings estimate. Nextel's second-quarter report sparked a 31% jump in the company's stock and elevated wireless stocks in general, boosting the shares of AT&T Wireless Services Inc. and Leap Wireless Inc. On Nasdaq, Nextel shares rose $1.53 to $6.53, and Leap was up 37 cents to $1.50.

For more than a year, the wireless industry has heralded the promise of third-generation technology and the coming of do-it-all phones with high-speed Internet connections and streaming video. Now, however, the mobile companies are changing their tune. Battered by low stock prices, slowing phone sales and the prospect of investing billions of dollars on new radio spectrum and networks, many companies say the shift to so-called 3G high-speed cellular networks isn't so urgent after all.

Ending decades of government price regulation, the Public Utilities Commission on Thursday approved a plan that would allow California's major phone carriers to raise rates at will. The unanimous decision to abolish most price caps came after the commission concluded that competition from cable carriers and wireless providers had grown strong enough to check rate hikes by traditional land-line phone companies such as AT&T Inc.

RealNetworks Inc. has scored its biggest victory to date in the mobile-phone market, convincing the world's largest wireless carrier to use Real's software to deliver video and music to its customers. On Sunday, Seattle-based Real announced a nonexclusive agreement to supply technology to Vodafone Group for a multimedia service that runs on its most advanced networks.

Capping a day of dueling announcements from rival cellphone service providers, AT&T said Tuesday that it would allow users of Apple Inc.'s popular iPhone to make Internet telephone calls over its wireless network. Hours earlier, Verizon Wireless, the nation's largest mobile carrier, said it was teaming up with Internet search giant Google Inc. to release a family of cellular devices powered by Google's Android software, whose capacity to run a vast array of "apps" is widely thought to represent a threat to the iPhone.

Succumbing to mounting opposition from federal regulators, AT&T Inc. abandoned its $39-billion bid to acquire wireless rival T-Mobile USA. The deal to create the nation's largest wireless carrier ran aground as antitrust authorities in the Obama administration opposed the takeover bid, arguing that the resulting telecommunications giant would squelch competition and lead to higher prices for consumers. But in a statement Monday, a defiant AT&T countered that the deal's collapse could harm consumers by slowing the development of high-speed wireless services.

Seattle billionaire Craig McCaw, who last year sold his cellular phone empire to AT&T Corp., said Wednesday that he will invest up to $1.1 billion in wireless communications carrier Nextel Communications Inc. The deal is a huge boost for Nextel, which is struggling to roll out a nationwide digital wireless communications system based on technology from Motorola Inc.

Sprint Nextel Corp. said it is buying a large chunk of struggling U.S. Cellular Corp., including its hometown Chicago market, for $480 million. The nation's third-largest cellular phone company also is buying U.S. Cellular's operations in St. Louis, central Illinois, Indiana, Michigan and Ohio. The deal, which requires regulatory approval and is expected to close in mid-2013, will transfer spectrum and about 585,000 customers — roughly 10% of U.S. Cellular's subscribers — to Sprint.