Sprint Nextel Corp. (NYSE: S) just continues to have one bad news release after another. The third-largest wireless carrier in the U.S. reported a dismal Q1 period, as a $211 million loss was posted amid large investments in operations that erased modest sales gains. At the same time, Sprint lost "high-quality subscribers" to the competition as problems with the Nextel side of the business continued.

Since Sprint acquired Nextel in 2005, the two businesses have not been integrated successfully. Before the merger, the ARPU (average revenue per user) for Nextel wireless subscribers was the highest in the entire U.S. wireless industry. After the merger, apparently Sprint did not take the steps needed to keep Nextel subscribers happy, the Nextel network deteriorated and massive defections resulted.

Sprint's loss of $211 million came to 7 cents per share, versus a profit available to common shareholders of $417 million, or 14 cents per share, a year ago. Q1 revenues were $10.1 billion (up from $10.07 billion a year ago), but CEO Gary Forsee stated that Sprint had spent a lot of money during the quarter trying to alleviate technological and signal problems that have driven away customers from its press-to-talk service.

Is it too little, too late to salvage the loyal Nextel subscriber? Possibly. If that ends up being the case, the incompetence Sprint management displayed after the Nextel acquisition should cause some heads to roll. I'm surprised it hasn't happened already, to be honest. The two leading wireless carriers in the U.S., Cingular Wireless (now AT&T Inc. (NYSE: T)) and Verizon Wireless (Verizon Communications (NYSE: VZ)), have benefited from Sprint's missteps in a huge way.