The ratings on Sprint Corp. reflect the strength of its local telephone operations and expected cash flow improvement in its wireless telephone segment. These factors are somewhat offset by pricing pressures in the company's long-distance segment and uncertainties regarding its growth initiatives. The local customer base provides more than 50% of Sprint's total cash flow. This segment should continue to benefit from the bundled offering of local, long distance, and personal communications services (PCS), despite the short-term impact of a slowing economy. Sprint PCS has posted strong subscriber growth while maintaining monthly average revenue per unit (ARPU) at healthy levels and bringing down churn. Reduction in disconnects reflects high contract rates, extended network coverage, and increased retention efforts. The PCS
