The two cellular companies are said to be in talks over a possible partnership to co-develop new services and handsets, media reports indicate.

This morning, CNBC reported that SK Telecom was interested in purchasing Sprint Nextel outright, however financial analysts quickly discounted the story saying the Korean cellular provider would likely not be able to swing such a deal. This was furthered by reporting by Reuters news wire and The Wall Street Journal, which seemed to indicate the talks centered around a partnership instead. A minority investment in Sprint also seems possible.

Such a move would be a reversal on Sprint's part. Last November, SK Telecom offered to invest $5 billion in the cellular operator in conjunction with Providence Equity Partners. As a result of the investment, SK would have had about a 12 percent stake in the company.

The deal was rejected by Sprint's board. With new CEO Dan Hesse now on board, and with righting the company's business his primary goal, it is quite possible that SK Telecom saw an opening to restart talks once more.

Any talks that are occurring would be in a very early stage, and may result in no deal at all. Neither SK Telecom nor Sprint Nextel were responding to requests for comment on the situation as of press time.

Some of the collaborative work may revolve around developing cell phone applications, and could quite possibly extend into WiMAX as well. SK Telecom has been pushing the technology hard in South Korea, and Sprint is just starting to roll out its own WiMAX network here. It has already invested hundreds of millions of US dollars in its WiBro networks across the country, has been paying dividends, and has attracted several hundred thousand customers.