September 5, 2014 / 5:28 PM / 3 years ago

Sprint expands rural roaming program, adding 15 new carriers

People talk on their cell phones as passers-by walk past a Sprint store in New York, October 15, 2012.Keith Bedford

WASHINGTON (Reuters) - Sprint Corp said on Friday it was adding 15 new rural and regional wireless providers to its U.S. roaming program, a move bolstering the company's efforts to cheaply expand its footprint as it fights to stay competitive as a national carrier.

The program allows Sprint and its smaller partners to use each other's networks for roaming at a mutually attractive price. A total of 27 carriers, covering 565,000 square miles and a population area of more than 38 million people, have now entered into roaming agreements with Sprint.

The 27 partnerships could save Sprint about $1.9 billion in expenditures on new cell phone towers and other infrastructure that would be necessary to bring 4G coverage to new areas on its own, based on calculations provided by a source familiar with the program estimates.

With those savings, deals with rural carriers could offer Sprint a lifeline to improve its national presence following the collapse of the merger with T-Mobile US Inc.

Like T-Mobile's, Sprint's network has been largely concentrated around metropolitan areas while the coverage by the two biggest U.S. carriers, Verizon Communications Inc and AT&T Inc, stretches nationwide.

Growing its footprint is one of Sprint's major challenges as the company struggles to win back millions of customers it lost during its messy network overhaul in recent years. The task is particularly tough in a nearly saturated market and with No. 4 T-Mobile pushing to leapfrog Sprint as the No. 3 U.S. carrier.

In March, Sprint Chairman Masayoshi Son struck an agreement with the Competitive Carriers Association, which represents many U.S. rural and regional carriers, providing the framework for a rural roaming program.

In June, Sprint announced the first 12 individual carriers to launch the rural roaming program into reality, including Virginia-based nTelos Wireless and Mississippi-based C Spire Wireless.

The 15 new partners announced Friday include Kentucky-based Bluegrass Cellular, Idaho-based Syringa Wireless and Alabama-based Pine Belt Wireless.

Perhaps because Sprint needs rural coverage more than its rivals, its 4G roaming agreements offer the carriers more perks and more flexibility than they have seen from other companies.

Verizon's program, for instance, largely limits partners to building networks that rely on airwaves owned by Verizon, while Sprint's allows them to use their own spectrum. Sprint's partners also say it offers more attractive roaming rates.

Another major perk Sprint offers is access to devices at cheaper prices negotiated with handset distributors, solving a major problem for smaller carriers who are often stuck paying top dollar for devices because they lack their competitors' scale.

Reporting by Alina Selyukh; Editing by Tom Brown

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