Sprint's debt close to edge. Sprint Nextel's (S) debt covenant is under intense scrutiny after the company drew down $2.5B of its revolving credit facility in February. Sprint's debt covenant limits its debt to 3.5 times Ebitda. Goldman analysts think a "credit event" is unlikely, but caution Sprint is "dangerously close to trouble." Jefferies analysts say Sprint will have to produce $7.6B in Ebitda in order to satisfy the covenant. A Sprint spokesperson says it will not have problems with its covenants this year.

CNET wrangles with shareholders. CNET Networks (CNET) had a "tense and uncomfortable" meeting with the private-equity consortium that has amassed a 21% stake in the company in an effort to stave off a proxy fight. Sources say CNET's board is in a "state of denial" about the seriousness of its situation. The group wants CNET to focus on updating its aging technology platform, while CNET is looking instead to aggressively expand its international business.

MySpace Music marches on. Sony BMG (SNE), EMI (EMIPY.PK) and Warner Music (WMG) could reach agreements with MySpace (NWS) about creating an online music service before month's end, with a launch of MySpace Music slated for later this year. Universal Music still insists MySpace resolve a copyright violation lawsuit before negotiating; a source says MySpace may just launch without Universal. Facebook, which is also in negotiations to launch a music service, may be spurred on by MySpace's progress. The service would offer ad-supported streaming music, with links for payed downloads.

Everyone wants a piece of iTunes. Mobile carrier O2, owned by Telefónica (TEF), will this week announce a deal with online music pioneer Napster (NAPS). Vodafone (VOD) is also in talks with NAPS.

Do You Want to Know a Secret? Paul McCartney will license the Beatles' entire catalogue to iTunes (AAPL) in a deal estimated at £300M. The music is expected to top download charts for several months following its release.

Mac modifications on the way. Sources say improved iMacs and Mac minis are due out within the next few weeks. This runs counter to rumors that Apple (AAPL) is discontinuing the Mac mini. Improvements include a beefier graphics chip and possibly a thinner enclosure.

Don't bank on this. HSBC (HBC) may make a move for UBS (UBS). One trader says HSBC's girth and UBS's woes could make a deal plausible. Another rumor, which was dismissed by traders, suggests Barclays (BCS) is mulling a bid for Societe Generale (SCGLY.PK).

Qualcomm 3G chips in Asustek phones. Asustek is developing 3G handsets that will use 3G chips from Qualcomm (QCOM). Sources say the two recently signed a licensing agreement.

Micron may ink DRAM deal. ProMOS may license 50nm DRAM technology from Micron (MU). Benefits to Micron benefits would include capacity backup from ProMOS, and the ability to deliver a more competitive cost structure. A deal may not be signed until later this year. There are also (conflicting?) rumors that ProMOS is in talks with Hynix over its 54nm technology.

Bearing down on Alaska delay. The Interior Department is launching an investigation into a two month delay in a decision on listing the polar bear as a threatened species. Oil and gas companies have a vested interest in the outcome, as an affirmative ruling could impose new drilling restrictions in the region. Something sounds fishy.

Drink deal delay. Cadbury Schweppes (CSG) may be forced to once again postpone the spin-off of its U.S. soft drink business. "Following a further deterioration in the debt markets, we believe there is now at least a 50/50 risk that Cadbury Schweppes might postpone the separation of its U.S. Beverages business," Bear Stearns analyst Simon Marshall-Lockyer writes.

Dug. "Rumors about a bidding war involving Google (GOOG) and Microsoft (MSFT) have created such a stir we feel compelled to tell you all directly that they are completely inaccurate. Sorry to burst any drama theories, but they aren’t true. We remain focused on improving Digg and rolling out great features." - Digg Blog.

Sony's a steal. WSJ says Sony (SNE) shares were undervalued even before a recent 26% drop over worries of a U.S. economic slowdown. Analysts say shares could gain 43% or more on the strength of cost cutting and other new efficiencies, a recent HD DVD coup, and strong LCD TV sales.

Low P/E ratio may not be buy signal. A recent 17% drop in the S&P 500 has its constituents' P/E ratio at a paltry 13.2, well below their 16.5 average since 1989. A buy signal? Maybe not, once you factor in potential inflation. Consider this: At the tail end of the 1980-82 bear market, stocks traded at just 8.7x earnings.

Web TV's great -- but where's the money? grow One of every four web surfers streamed full-length TV during the last three months, including 39% of those 18-34 -- and 23% of the up-and-coming 35-54 generation. Good news or bad for TV networks? "The $4.5 billion we make on broadcast is never going to equate to $4.5 billion online," CBS's (CBS) Quincy Smith says. "Our challenge with all these ventures is to effectively monetize them so that we do not end up trading analog dollars for digital pennies," NBC's (GE) Jeff Zucker says.

Cable co.'s connect. Executives from Comcast (CMCSA), Time Warner Cable (TWC), Cablevision (CVC), Cox Communications, Charter Communications (CHTR) and Bright House Networks are planning a JV, code-named Project Canoe, that will enable customers to buy cross-vendor custom and interactive ads. The initiative is aimed at slowing Google's (GOOG) slow "siphoning" of ad dollars from TV. Targeted "advertising on television is in many ways the holy grail, because it can offer ever more targeting ability than Google," Bernstein analyst Craig Moffett says. Execs think the move can boost the cable industry's ad take from $5B to $15B a year -- not a bad deal for an initial $150M investment.

Nortel hopes IPTV apps will stir pot. Nortel (NT) is preparing to launch a series of IPTV apps that will work with all vendors' middleware. Nortel's IPTV initiatives have failed to gain traction; it has just one Tier 1 customer, Telus (TU). "In the Tier 1 space, most of them have made their technology selections," Nortel's Grant Hall says. "That's where this platform comes in, to work with the incumbent middleware provider and add stuff on top of it. We think it changes the game, taking a middleware-agnostic approach."

Xbox undercuts Wii. Amazon.com (AMZN) unofficially confirmed rumored Xbox 360 (MSFT) price cuts by dropping the price on all editions. The Xbox 360 Arcade is now £149.99 (down from £199.99), the Premium goes to £189.99 (down from £249.99), and the Elite will sell for £249.99 (down from £299.99). By comparison, the Wii (NTDOY.PK) costs £179.98 and the Playstation 3 40GB (SNE) costs £299.99.

UAE studies dollar depeg. The United Arab Emirates [UAE] is considering depegging its currency from the U.S. dollar. Saudi Arabia, Qatar, Bahrain and Oman also peg their currencies to the dollar. The group is under pressure to depeg as a weak dollar stirs already high inflation in the region.

2% on the way? Goldman Sachs (GS) analysts still think the FOMC will cut rates to 2% by late April -- a pace of 0.5% over its next two meetings. However, "we cannot rule out an intermeeting rate cut today," it said.

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Eli Hoffmann

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