Sprint bets on Samsung phone to help recovery

By Sinead Carew

LAS VEGAS (Reuters) - Sprint Nextel Corp (S.N: Quote, Profile, Research, Stock Buzz) is betting on a touch-screen phone from Samsung Electronics Co Ltd (005930.KS: Quote, Profile, Research, Stock Buzz) and more than $100 million of marketing to help the No. 3 mobile service provider regain cache among consumers.

Sprint, which has been losing subscribers because of customer service problems, will unveil the Samsung Instinct phone during a keynote speech by Chief Executive Dan Hesse on Tuesday at CTIA, the annual U.S. wireless show in Las Vegas.

The company will spend about three times more on marketing the Instinct than on its biggest phone launch last year. Sprint also took the unusual step of leading the design of the device's user controls, known as the user interface, with an aim to making the phone as easy as possible to use.

"The iPhone set a bar for user interface," said Sprint product commercialization director David Owens. "We wanted to have an equivalent experience."

Sprint said the Instinct should be a top seller this year and is a key part of a campaign to win back customers from rivals such as AT&T Inc (T.N: Quote, Profile, Research, Stock Buzz), the exclusive U.S. provider for Apple Inc's (AAPL.O: Quote, Profile, Research, Stock Buzz) popular iPhone.

"Our goal is clearly that it's large volume," Owens said.

Sprint's shares have lost more than two-thirds of their value since hitting a year-high in June 2007. The company posted a $29.45 billion loss for the fourth quarter after a massive write-off and steep customer losses.

Sprint has yet to finalize pricing for the Instinct's mid-June launch but said it would cost less than $300. In comparison, the cheapest iPhone costs $399 with eight gigabytes of storage and $499 for a model with twice as much memory.