Update: Newer details have emerged about how AT&T will stand out from standard Sprint service, besides different phone offerings. AT&T plans to offer phones with built-in WiFi VoIP capacity. These handsets will automatically switch their services to an available WiFi network to place calls airtime-free when available, and fallback to Sprint’s network when out of range. This package deal will allow AT&T to break into the broadband phone market and compete head-on with Vonage and other VoIP carriers, by providing home and businesses with home phone service that integrates with wireless service seamlessly.
AT&T has just entered into an agreement to become a Mobile Virtual Network Operator (MVNO) with Sprint PCS. AT&T will sell the service under a new brand (that probably won’t be named “AT&T Wireless”), and has begun testing new phones in several cities.