Sprint Nextel Corp. will begin selling the new version of the Apple iPhone in mid-October, people familiar with the matter said, filling a huge hole in the No. 3 U.S. carrier's lineup and giving Apple Inc. another sales channel for its popular gadget. 
 
 The timing, however, indicates Apple's new iPhone, which is expected to be called iPhone 5, will hit the market later than expected and too late to contribute to sales in Apple's fiscal fourth quarter, which ends in September. Most observers had expected the device to arrive next month. 
 
 Sprint will get both the new iPhone 5 and the iPhone 4 but it's unclear just how many new subscribers Sprint will be able to reel in come this fall, MarketWatch's Dan Gallagher reports on Markets Hub. (Photo: AP Photo.) 
 
 The deal could help prop up the nation's third-largest carrier and give AT&T Inc. more ammunition in its attempt to win regulatory approval for its proposed acquisition of No. 4 U.S. carrier T-Mobile USA Inc. 
 
 Verizon Wireless and AT&T, the two largest wireless carriers, measured by subscribers, will begin selling the phone in mid-October as well, according to two people familiar with the matter. 
 
 Sprint had more than 52 million subscribers at the end of the second quarter, compared with 106 million for Verizon and nearly 99 million for AT&T. 
 
 Sprint will begin selling the iPhone 5 in mid-October, closing a huge hole in the No. 3 U.S. carrier's lineup and giving Apple another channel for selling its popular phone. Spencer Ante has details on The News Hub. 
 
 Landing the iPhone is a big win for Sprint, whose results have suffered without being able to sell the trend-setting device. AT&T has relied on versions of the Apple device to drive sales since 2007. This February, Verizon Wireless began selling the iPhone 4. Verizon Wireless is a joint venture of Verizon Communications Inc. and Vodafone Group PLC. 
 
 In the second quarter, Sprint blamed a decline in its contract subscribers on more pronounced "competitive headwinds," most prominently, "the first full quarter both major competitors offered the iPhone." 
 
 Sprint will also carry the iPhone 4, starting at the same time, one person familiar with the situation said. 
 
 Richard Doherty, director of the research firm Envisioneering Group, said that the addition of the iPhone would help Sprint retain many of its customers itching to upgrade. The iPhone will also increase foot traffic in Sprint stores, which should help the company to sell high-margin iPhone accessories. "Sprint needs it," said Mr. Doherty. "There are a lot of families that will embrace the iPhone." 
 
 That said, the deal could also hurt Sprint by helping AT&T improve its chances of winning approval from regulators for its $39 billion purchase of T-Mobile USA, said Marc Ostrau, a partner and co-chair of the antitrust and unfair competition group at law firm Fenwick & West. 
 
 "It not only is likely to give Sprint a boost but also puts more focus on the increasing importance of device suppliers relative to carriers," said Mr. Ostrau. 
 
 Herbert Hovenkamp, a professor of law at the University of Iowa, said a Sprint iPhone would probably help AT&T's efforts, but he said the impact depends on how much regulators determine the deal curbs AT&T's ability to raise prices without losing too many sales. 
 
 "The question is how much more competition do you get when you have two rivals rather than one," said Mr. Hovenkamp. 
 
 The cellphone business is increasingly driven by hot smartphones, which are growing more sophisticated and expensive. Apple commanded an average of more than $650 apiece for its iPhones last quarter. Carriers subsidize the difference between that cost and the phone's $199 or $299 retail price, hoping to make up the difference with the data plans they sell over the course of two-year contracts customers must sign to get the subsidy. 
 
 Apple created additional leverage for itself by signing exclusive deals when it first launched the iPhone in 2007. In recent years, the company has changed strategy, inking deals with multiple carriers in countries around the world. 
 
 The new iPhone is expected to be similar to the current iPhone 4, but thinner and lighter with an improved digital camera and a new more sophisticated operating system. 
 
 Apple said in June that a new version of its mobile operating system would be available this fall, leading many analysts to conclude that an upgraded iPhone would be introduced at the same time. 
 
 On a July earnings conference call, Apple Chief Financial Officer Peter Oppenheimer said the company's September quarter would be affected by "a future product transition that we are not going to talk about today," increasing anticipation. 
 
 While Apple unveiled the iPhone 4 at its June developers' conference last year, its successor wasn't ready in time for this year, according to a person briefed on Apple's product plans. The company then aimed to launch a new iPhone by the end of September, though two people familiar with the situation previously told The Wall Street Journal that the phone could be delayed again if its contract manufacturer couldn't improve its production yield rate. 
 
 Enlarge Image Close Bloomberg News Sprint, fighting to turn itself around after its disastrous merger with Nextel last decade, has managed to stem subscriber defections and improve customer service. Above, a Sprint store in San Francisco. 
 
 Sprint, fighting to turn itself around after its disastrous merger with Nextel last decade, has managed to stem subscriber defections and improve customer service. But it has disappointed investors by failing to add new subscribers more quickly, in part because it competes with rivals that carry Apple's fast-selling phone. 
 
 Verizon Wireless, which cracked AT&T's exclusive U.S. hold on the iPhone this year, has sold 4.5 million of the Apple devices in the first half of 2011. 
 
 AT&T, which is also able to sell a cheaper prior version of the iPhone, has sold 7.2 million this year. 
 
 —Yukari Iwatani Kane contributed to this article. 
 
 Write to Joann S. Lublin at joann.lublin@wsj.com ||||| With the iPhone 5 possibly on its way to Sprint Nextel, could the end of its much-loved unlimited-data plan be far behind? 
 
 commentary Once Sprint Nextel gets the iPhone, you can bid farewell to its unlimited-data plan. 
 
 Sprint CEO Dan Hesse, as seen in one of the company's much-played black-and-white television commercials. (Credit: CBS/Sprint) 
 
 If history is any indication, Sprint will have to make some tough decisions, if Apple's blockbuster device starts weighing on its network. It's something the other carriers have done, and it's part of a broader trend of telecommunication companies struggling to keep up with growing bandwidth consumption. 
 
 After suffering through years of heavy bandwidth usage from iPhone users, AT&T; relented and switched to a tiered pricing plan last year. It only took Verizon Wireless a few months after launching its version of the iPhone 4 before it opted to apply similar data caps. 
 
 Sprint, which The Wall Street Journal reported today will be getting the iPhone 5 at the same time as AT&T; and Verizon in October, will likely follow the same path. 
 
 I have no first-hand knowledge of Sprint's thinking on its successful--but taxing--offer of an all-you-can-eat data plan for its smartphones. A Sprint representative wasn't immediately available to answer my questions. 
 
 But I do know that networks aren't fundamentally different from each other, despite the marketing jargon and hype that surrounds them. Sprint doesn't have any more capacity than Verizon and AT&T.; In fact, it may be in a worse position now because its unlimited-data offer is unique in the market, likely attracting the heaviest of users. 
 
 The carriers' switch to tiered plans doesn't include existing unlimited-data customers, who have had the option to be grandfathered into an unlimited plan. You can see the strain the grandfathering is putting on the carriers, with both AT&T; and Verizon switching to language in their service agreements that allow them to throttle, or choke off, the connection speed when a user exceeds a certain threshold of data consumption. 
 
 Sprint is in a touchy spot because it has positioned itself as the unlimited carrier. Ads talk about the company's truly limitless plans, and Chief Executive Dan Hesse has been featured on commercials deriding competitors' actions such as throttling. 
 
 As I've written, Verizon's decision to switch to a capped plan has been a boon for Sprint. The carrier is the only remaining company to offer a truly unlimited-data plan, a rare marketing and competitive edge outside of cheaper prices. Even Sprint's prepaid arm, Virgin Mobile, has decided to employ throttling. 
 
 But all good things have to come to an end. Speaking to a roundtable of bloggers and reporters last month, Hesse acknowledged that data traffic could eventually be an issue. 
 
 "Nothing's a guarantee that it's forever," he said at the time. 
 
 For Sprint, the choice is a trade-off: keep the unlimited-data plan and spur additional customer growth, or cut back on the plans and ease the need to invest in more capital for the network. Its decision may indicate whether it is favoring the consumer or Wall Street. 
 
 When I wrote about Sprint eventually dropping the unlimited-data plan, analysts gave it a year to 18 months before a change would happen. But with the iPhone becoming available to Sprint customers, that timetable could be accelerated. Thanks to its more affordable data plans, Sprint has a higher base of smartphone customers than its rivals--roughly half of its total customers. 
 
 While it has gotten used to dealing with the bandwidth-intensive Android phone, Sprint may be in for another pounding, once more customers start upgrading their basic phones for the iPhone. 
 
 And even if the iPhone isn't significantly more data-hungry than its Android counterparts, Sprint may use the iPhone's reputation as an excuse to close off the unlimited-data spigot. 
 
 So what does that mean for customers? If the iPhone does come out for Sprint, hop on an unlimited-data plan while you can (and thus get grandfathered in). The plan may not be around much longer.
– The iPhone 5 will be available on Sprint's network as well as Verizon's and AT&T's when the new phone is launched, insiders tell the Wall Street Journal. The device will hit the market in mid-October, not next month as many had expected, the sources say. The iPhone 5 deal will provide a major boost for the nation's third-largest carrier, whose bottom line had suffered without the ability to sell iPhones, analysts say. The deal, however, could end up backfiring on Sprint if it improves AT&T's chances of getting the green light from regulators to buy T-Mobile USA. Verizon ditched its unlimited plans not long after it launched its version of the iPhone 4 earlier this year, notes Roger Cheng at CNET, who recommends that Sprint users hop on unlimited data plans now to get "grandfathered in" before the Sprint iPhone arrives.