Shareholders in Sprint Nextel Corp voted on Tuesday to give holders of 10 percent of shares outstanding the power to hold a special meeting, indicating they wanted a stronger voice.

While shareholders voted in line with the company on other proposals, including the election of 10 directors nominated by the company, Sprint said about 77 percent of votes were in favor of the shareholder proposal on special meetings that the company opposed.

One shareholder used the meeting as a platform to complain about everything from advertising to customer service at Sprint, which has been steadily losing customers in the last few years, including its biggest ever loss of monthly bill paying customers for the first quarter this year.

Chief Executive Dan Hesse told shareholders during a Webcast of the annual meeting, held in Overland Park, Kansas, that Sprint had been making good progress with improving its customer service in stores and in call centers that handle customer telephone inquiries.

But one person who identified herself as a Kansas-based shareholder begged to differ and told the audience several of her friends were unhappy with Sprint's service.

They still have numerous complaints with your customer service, she told Sprint at the meeting.

She also went on to question Sprint's advertising strategy and asked why she received no direct-mail advertising from Sprint, but plenty from its rivals AT&T Inc and Verizon Wireless, owned by Verizon Communications Inc and Vodafone Group Plc .

Hesse said he was planning to resume direct-mail advertising, which Sprint cut last year to save money.

I didn't even know until recently that this was part of our cost-cutting, he told the audience.

Soleil/Nelson Alpha Research analyst cited anecdotal evidence of improvements in customer service, but said investors were still worried about high levels of customer cancellations and marketing.

The consensus among institutional investors is still that the marketing message is still weak and needs to significantly

improve, Nelson said in a telephone interview with Reuters.

Hesse told shareholders the three issues on the top of his agenda were the same as those listed at last year's meeting, improving the experiences of customers, rebuilding its brand and improving the company's financial situation.

It might be boring, but it's the same priorities this year, he said.

John Krause, a research analyst at Thrivent Asset Management, which manages about $68 billion in assets, including 1.2 million Sprint shares, said he had no problems with Sprint's customer service, but worries cost cuts could be hurting services.

Krause has some hope the upcoming launch of the high- profile Pre phone from Palm Inc

could give Sprint a marketing boost and help it compete better with rivals.

Sprint used to have the best handsets, he said in a telephone interview with Reuters. Maybe the Palm Pre gets them back in the game, but I'm not sure its the savior phone.

Sprint shares were 8 cents down at $5.33 at the close.

(Reporting by Sinead Carew; Editing by Steve Orlofsky and Andre Grenon)

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