NEW YORK (WiMAX Day). At the Lehman Brothers Worldwide Wireless and Wireline Conference today, Paul Saleh, the Chief Financial Officer of Sprint Nextel said that WiMAX will lower infrastructure costs and allow Sprint to offer services to consumers at lower rates. Saleh told his audience that this would deliver a ten times increase in cost performance benefit.

One reason for the low cost of deploying WiMAX is that it does not rely on the subsidy model present in the current cellular network, where handsets are provided at a reduced cost. This point was reiterated by Barry West, President 4G Mobile Broadband and CTO at Sprint Nextel, who spoke today at the WiMAX World Europe conference in Vienna.

West said that the industry must move to an open architecture and abandon the era of closed subsidised hardware that limits the growth potential of cellular communications, and effectively limits the consumer’s ability to use of a truly open environment.

The Sprint business model is also focussed on targeted customer segments interested in new and innovative products and applications, while connectivity through embedded devices will drive the service. Saleh explained that WiMAX has a “sizeable revenue opportunity” that is presently untapped in the market, driven by the use of the Internet, which West said is growing faster than the use of cellular and GSM.

WiMAX delivers an efficient use of capital, according to Saleh. The cost of equipment is low, in comparison with other technologies, and when coupled with Sprint’s existing spectrum, the company will be able to leverage other assets such as its IP backbone and back-office systems to achieve superior performance.

While WiMAX will provide considerable cost benefits for Sprint, the company also has a significant first mover advantage in the US market.

As the first major US cellular operator to offer WiMAX services, Saleh said that this advantage will allow Sprint to deliver a strong brand image to the market. Sprint has not given any indication about how it will market WiMAX services to consumers. However, rumour has it that ad agency Goodby, Silverstein & Partners, a unit of Omnicom Group that was awarded the creative portion of Sprint’s $1.5 billion consumer advertising account in March, also may be working on the ad strategy for Sprint’s WiMAX network.

David Ogilvy once noted that an industry isn’t born until the advertising budget is spent. In the case of WiMAX, if long-haired ad execs are now planning the first TV commercials, it would seem that Sprint’s well-planned ecosystem has indeed evolved into an industry.