By Sinead Carew

NEW YORK (Reuters) - Sprint Nextel Corp , the No. 3 U.S. mobile service, is in talks to put applications from Web search leader Google Inc on its cell phones, a person familiar with the matter said on Wednesday.

Google is in talks with some of the largest U.S. wireless carriers to make a deeper move into the mobile industry, an area it views as key to future growth.

While the company has not commented on its plans or potential partners, industry experts believe it will soon launch new software and services for mobile phones.

On Tuesday, sources told Reuters that No. 2 U.S. mobile service Verizon Wireless, a Verizon Communications and Vodafone Group Plc venture, is also in talks with Google about putting applications on its mobile phones.

Sprint had already said in August it would offer Google Web search and communications services to customers using a new network it is building based on WiMax, an emerging high-speed wireless technology.

"You shouldn't be surprised to see something coming along with Sprint and Google beyond WiMax," according to the source. Sprint and Google declined comment.

They are talking about putting mobile applications from Google and other developers on Sprint devices, the source said.

"While discussions may be ongoing and moving along pretty quickly, it's early in the process on how these things might come to market," the person said.

Google, which generates revenue from delivering ads alongside search, e-mail and other Web features, has said that mobile Web surfing would be important to its business as consumers move beyond desktop computers.

Google has also shown interest in an upcoming government wireless auction, and pushed regulators to introduce rules that give mobile operators less control over the devices and data applications their customers can use.

U.S. wireless operators have been spending billions of dollars to expand their services to mobile Web surfing and entertainment, aiming to boost revenue by enticing consumers to use their phones for more than just talking.

Shares of Google were up $5.09 or 0.75 percent at $699.99 on Nasdaq after topping $700 earlier in the session for the first time. Sprint, which is set to report quarterly earnings on Thursday, saw its shares fall 9 cents, or 0.53 percent, to $16.95 on the New York Stock Exchange.

(Editing by Phil Berlowitz)
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