US Cellular and Alltel Reach Agreement

[PTCO911]

US Cellular and Alltel reached an agreement for US Cellular to purchase the divested Kansas and Nebraska Cellular One markets.

[Junya]

that would be alright, seeing as alltel pretty much operates the entirety of NE and most of KS...give themselves a lil bank in the pocket for some regional and perhaps national advertising

[MOTOhooligan]

Originally Posted by Junya that would be alright, seeing as alltel pretty much operates the entirety of NE and most of KS...give themselves a lil bank in the pocket for some regional and perhaps national advertising

Of the CellularONE-Western Wireless markets in Kansas/Nebraska, Alltel was allowed to keep only one, Lincoln, NE. Pretty much in any other (non-metro) area of Kansas/Nebraska, Alltel and CellularONE were the two major competitors so they had to divest. Someone had to get it, a lot of people (including PTCO911, if I'm not mistaken) were hoping it would be Verizon. For some reason, I thought it would be Cingular but I don't know why I thought that. USC makes more sense than Cingular, though.

[Andy]

I would have thought that Verizon would want some more in Kansas but I guess I was wrong.

[MOTOhooligan]

Originally Posted by Andy84094 I would have thought that Verizon would want some more in Kansas but I guess I was wrong.

Why buy the cow when you can get the milk for free? Verizon doesn't need any Kansas coverage as they already have a sweet roaming agreement with Alltel who covers all of Kansas except the I-70 corridor west from Manhattan through Topeka, Lawrence and Kansas City, where Verizon already has service.

[Andy]

Well, they'd have a network there ready to go then, wouldn't have to pay Alltel or whoever roaming charges and could offer native service to those few farmers there

[MOTOhooligan]

Originally Posted by Andy84094 Well, they'd have a network there ready to go then, wouldn't have to pay Alltel or whoever roaming charges and could offer native service to those few farmers there

That's the thing... I can't figure out if it would be more cost-effective to just keep the roaming agreement with Alltel and have them maintain the network or obtain the divested WWC markets in KS/NE and maintain the networks themselves. The Verzion/Alltel roaming agreement runs through 2010, I think, so either way, they'd have keep the agreement until at least then.

I wonder if there's an easy way to find all that out... or maybe, Verizon not bidding on the markets is a sign that it isn't worth their while to snatch them up. Who knows?

[Andy]

They must really not care for a network in that area, or the roaming on ALLTEL must be so dirt cheap that they simply don't care in having their own network in the area. IF Verizon still doesn't have a network in the area in 2010 I'd think that the roaming agreement would be extended.

[MOTOhooligan]

Originally Posted by Andy84094 They must really not care for a network in that area, or the roaming on ALLTEL must be so dirt cheap that they simply don't care in having their own network in the area. IF Verizon still doesn't have a network in the area in 2010 I'd think that the roaming agreement would be extended.

I don't know the specifics but I believe that the VZW/Alltel roaming agreement is probably the best in the industry, based on the tidbits here and there I have heard.

[Andy]

Absolutely- Verizon gets the cheapest roaming rates from ALLTEL than from any other carrier.

[BillRadio]

While the Alltel/Verizon roaming agreement is very favorable, it does expire in 2010 and then Alltel will be among very few choices. The roaming costs could go up considerably. In other areas of the country where Verizon has the spectrum, they have been replacing roaming on Sprint PCS and Alltel with they own (mostly PCS) sites.

Both Cingular and Verizon could have used the divested spectrum, but if USCC ended up with it, it looks like they didn't even try.