Latest Merger Rumor: Verizon Wireless And Altell

[jones]

Latest Merger Rumor: Verizon Wireless And Altell

Thu Dec 23, 9:47 AM ET

Mobile Pipeline News

Alltel, a small wireless carrier that focuses on underserved areas such as rural areas, is a natural takeover target for Verizon Wireless, according to an industry analyst quoted this week by BusinessWeek Online.

Rumors circulated in the last two weeks that Verizon Wireless was interested in gobbling up Sprint after that company's merger with Nextel is completed next year. However, Tavis McCourt, an analyst with the Morgan Keegan investment firm, told BusinessWeek Online that Alltel makes much more sense as a Verizon takeover target.

That's because Alltel has a large user base, with 8.4 million subscribers, is profitable and uses the same CDMA (news - web sites)-based technology as Verizon Wireless, McCourt said. In addition, the acquisition would beef up Verizon's presence in rural areas and enable its customers to roam more in those areas, McCourt said.

By contrast, an attempted acquisition of Sprint would face difficulty being approved by federal regulatory authorities because the combined entity would control 40 percent of the wireless market, McCourt told BusinessWeek Online.

Acquiring Alltel would enable Verizon Wireless to regain its position as the top wireless operator in the U.S., giving it more than 50 million subscribers compared to 46 million subscribers for Cingular.

VZW Buying ALLTEL

[jones]

If this goes through VZW will be the Biggest carrier again.

[agentHibby]

There is a possiblity of getting VZW service in my hometown with Verizon if this goes thru!

[jones]

Originally Posted by agentHibby

There is a possiblity of getting VZW service in my hometown with Verizon if this goes thru!

kool...

[kyousif]

That would be a nice deal.

[Etorres777]

I don't think ALLTEL wants to sell though. This may be good too because we have both offered here in my town, so they'd probably have to divest spectrum and hopefully Cingular can buy it and fix up the not so good job AT&T did when it built the towers here. I dream too much LOL. I also think the FCC and DOJ wouldn't approve it.

[Andy]

that would be nice since it would give VZW a lot of new native coverage and customers, since both are CDMA it wouldn't be too hard to do. But IMO, VZW will regain the number one spot anyway, sooner or later.

[jones]

Originally Posted by Andy84094

But IMO, VZW will regain the number one spot anyway, sooner or later.

Without Merging, that remains to be seen.

[kyousif]

Originally Posted by jones

Without Merging, that remains to be seen.

It still seems they are having steady and solid growth. Without merging I would guess within two years the'll out number cingular in terms of subscribers. I wouldn't see any reason why Verizon aquiring Alltel wouldn't go through.

[agentHibby]

A few crossover rural celluar networks would have to be divested if Verizon would do this. I would guess the old Southwestco network in Arizona would have to be sold again. My guess would be Western Wireless.

Verizon wireless might buy out Commnet Wireless with their zero customers to become the #1 provider again.

[jones]

Originally Posted by kyousif

It still seems they are having steady and solid growth. Without merging I would guess within two years the'll out number cingular in terms of subscribers. I wouldn't see any reason why Verizon aquiring Alltel wouldn't go through.

CINGULAR Has Licenses in almost all Markets,
VZW does'nt.
So how can VZW catchup in areas where
they don't have a License, without Merging/acquiring.
Meaning VZW can't sell service in areas
they don't have a License,
which means they will not overtake Cingular.
And this is the Cingular Advantage,
which VZW is missing the point

[Andy]

Originally Posted by jones

CINGULAR Has Licenses in almost all Markets,
VZW does'nt.
So how can VZW catchup in areas where
they don't have a License, without Merging/acquiring.
Meaning VZW can't sell service in areas
they don't have a License,
which means they will not overtake Cingular.
And this is the Cingular Advantage,
which VZW is missing the point

I'm sorry, Jones, but as you can obviously see, VZW managed/and is still managing their way to gain more customers than anyone else and loose fewer customers than anybody else, even with not having licenses everywhere.
Of course VZW won't get a lot of customers in their unlicensed markets, but in markets where they are licensed, more and more people choose VZW over other carriers.
"VZW is missing the point"...well that's good for Cingular then... We'll see what will happen in the future. The one who laughs last laughs the best as they say.

[jones]

Originally Posted by Andy84094

VZW managed/and is still managing their way to gain more customers than anyone else and loose fewer customers than anybody else.

An area has only so much customers, before it gets saturated.
Meaning everbody got a mobile phone already.
So they have to look into other areas,
and that's by either merging or building a new wireless network.

[Andy]

Don't worry, Jones, it's not yet time to worry about that. As you can see, it's going very well for them!

[jones]

Originally Posted by Andy84094

Don't worry, Jones, it's not yet time to worry about that. As you can see, it's going very well for them!

I'm not worried.
But if VZW new customers will be churn coming from other
carriers that's not going to make them the biggest.

[Andy]

Originally Posted by jones

I'm not worried.
But if VZW new customers will be churn coming from other
carriers that's not going to make them the biggest.

I'm sorry, but I really don't understand this comment, Jones. Who cares if a customer is a first time cellular customer or a customer of a different company looking for better cell service??

[wgray8231]

I was under the impression that getting new subscribers from other carriers helped put VZW in their former #1 position. Cingular didn't think they could keep up, so they merged with ATTWS.

I could switch carriers and save money, but you get what you pay for.

[ZaphodB]

Let's keep the Cingular/Verizon cheerleading/bashing to a minimum, please.

You won't see real integrated numbers until the Q1CY2005 numbers start coming out in April -- the Q4CY2004 numbers won't accurately reflect anything other than some simple arithmetic.

[Fathead]

Cing&T doesn't have a license here!

[jones]

Originally Posted by Fathead

Cing&T doesn't have a license here!

Idaho is a low population area so it will not make any difference.

[Andy]

Originally Posted by jones

Idaho is a low population area so it will not make any difference.

Oh-okay, excuse me, but while I was in Idaho, Montana, Wyoming this summer, most locals I met had Verizon phones, from Pocatello, Idaho Falls, Rexburg to West Yellowstone and Gardiner, Montana. Service was great, GSM is still not out in some of those necks of the wood places.
This does make a difference.

[Andy]

Originally Posted by wgray8231

I was under the impression that getting new subscribers from other carriers helped

Well, I guess we were proven wrong

[ZaphodB]

Last warning...

[wgray8231]

Looking back at the last year (Q4 '03 to Q3 '04), Verizon has outgained Cingular/ATTWS combined a total of 3.5 million subscribers. With the numbers I found, that puts VZW at a total of 43.8 and Cingular/ATTWS at 46+ without the Q4 '04 results being counted. That average of 880,000 customers per month higher net would close the gap of 3 million in about a year.

Of course, the upcoming Q4 '04 numbers will tell us a lot more. In a few weeks we might be able to better predict further growth with the latest results.

Anyway, the number of subscribers a carrier has doesn't necessarily reflect on quality or value of service. That's what capitalism is all about.

[jones]

Originally Posted by Andy84094

Oh-okay, excuse me, but while I was in Idaho, Montana, Wyoming this summer, most locals I met had Verizon phones, from Pocatello, Idaho Falls, Rexburg to West Yellowstone and Gardiner, Montana.

In some states VZW CDMA is not in the area too.

[Andy]

Originally Posted by wgray8231

Looking back at the last year (Q4 '03 to Q3 '04), Verizon has outgained Cingular/ATTWS combined a total of 3.5 million subscribers. With the numbers I found, that puts VZW at a total of 43.8 and Cingular/ATTWS at 46+ without the Q4 '04 results being counted. That average of 880,000 customers per month higher net would close the gap of 3 million in about a year.

Of course, the upcoming Q4 '04 numbers will tell us a lot more. In a few weeks we might be able to better predict further growth with the latest results.

Anyway, the number of subscribers a carrier has doesn't necessarily reflect on quality or value of service. That's what capitalism is all about.

I have to totally agree with your last paragraph.
Now that AT&T/Cingular are together, more people are deciding to go with them, especially people that want to go the GSM route now chose the new Cingular over T-Mo, and I'm sure that the new Cingular will now add more customers than combining AT&T/Cingular numbers before the merger.

[wgray8231]

Originally Posted by Andy84094

I have to totally agree with your last paragraph.
Now that AT&T/Cingular are together, more people are deciding to go with them, especially people that want to go the GSM route now chose the new Cingular over T-Mo, and I'm sure that the new Cingular will now add more customers than combining AT&T/Cingular numbers before the merger.

I would bet that are a lot of people that will switch to the new Cingular just because of the merger thinking that coverage will be incredible. I haven't seen any maps, but I would guess that ATTWS and Cingular already had some overlap. Of course, the distance and capacity limitations of GSM means a higher concentration of towers doesn't hurt.

If the new Cingular takes off, we'd have to congratulate the marketing department. It's not easy to sell technology that's been in use for 12 years. Americans are pretty gullible, though; Europeans are more tech-savvy.

[Andy]

Yes, there was a lot of overlap coverage wise. Quite a few areas, though, are new for the 'New Cingular', in states like UT, CO, and more here out west.
Cingular's coverage maps totally blow away t-mobile's coverage maps(coverage maps can be exagerated though...).