UPDATE 2-Sprint has Pre U.S. exclusivity through end-'09

(Adds background details, share price update)

NEW YORK, Feb 19 (Reuters) - Sprint Nextel Corp S.N has exclusive U.S. rights to sell Palm Inc's PALM.O hotly anticipated Pre phone through the end of 2009, a person familiar with the matter said on Thursday.

The person, who asked not to be named, said the exclusivity period for the phone lasts at least through the end of 2009. The person did not comment beyond this year.

Neither Sprint nor Palm have not announced how long the exclusivity period would last for the touchscreen phone, due to go on sale in the first half of the year.

The device, viewed as a potentially strong competitor to Apple Inc's AAPL.O iPhone, is expected to help Sprint in its efforts stem customer losses.

Many analysts see the Pre as Palm's best chance to improve its weak market position as it has been losing customers to iPhone and BlackBerry from Research In Motion RIM.TO.

When the Pre was announced in January, some analysts were disappointed that Sprint would be the exclusive provider because the No. 3 U.S. mobile operator has been losing customers to rivals for the last few years.

Palm shares were down 20 cents, or 2.6 percent, at $7.43 after the news. Sprint, which reported a narrower-than-expected quarterly loss on Thursday, saw its shares rise 74 cents, or 27 percent, to $3.45 in early afternoon trade. (Reporting by Sinead Carew and Franklin Paul; Editing by Lisa Von Ahn)