Regulators Let Cingular Buy AT&T Wireless Merger Will Create Biggest U.S. Cell Firm By Yuki Noguchi Washington Post Staff Writer Saturday, October 23, 2004; Page E01 The $41 billion merger between Cingular Wireless LLC and AT&T Wireless Services Inc. won approval from the Federal Communications Commission yesterday, according to federal sources close to the agency, paving the way for major changes in the lucrative wireless-phone market. The FCC and Justice Department plan to announce on Monday that both agencies have signed off on the deal, although the regulators will require Cingular to make some concessions in return, according to the sources, who declined to be identified because the decision has not yet been made public. Cingular's purchase of AT&T Wireless will give the company about 47.6 million customers -- roughly 27 percent of the nation's wireless market and enough for it to surpass Verizon Wireless as the nation's largest cellular provider. It will serve all of the top 100 markets in the United States. To satisfy the antitrust concerns of regulators, Cingular will have to sell AT&T Wireless's business, including stores and customers, in 16 mostly rural and suburban markets, according to the sources. The company also will be ineligible to buy additional airwave licenses in areas where the combined company controls 70 megahertz or more of spectrum; 189 megahertz is the total available for use by mobile-phone companies in a market. Additionally, the company will have to sell a portion of its airwave licenses in some other markets. Spokesmen for Atlanta-based Cingular, Redmond, Wash.-based AT&T Wireless, the FCC and the Justice Department declined to comment on the pending merger. Company officials and some analysts say the combined resources of size and marketing power could mean cheaper phone bills, new high-speed services and better network coverage for Cingular and AT&T Wireless customers. Cingular, along with its two parent companies -- SBC Communications Inc. and BellSouth Corp. -- also could step up their marketing of bundled packages of local, long-distance, and wireless service. But consumer groups and some smaller rivals said the dominance of Cingular and its parents could hurt customers. The Phoenix Center for Advanced Legal & Economic Public Policy Studies, a policy think tank, estimated the merger could narrow customer choice and result in an 8 percent increase in wireless prices. The deal is expected to close soon after regulatory approval is announced. The two Democratic FCC commissioners, Michael J. Copps and Jonathan S. Adelstein, joined the three Republicans in the decision but dissented in part, citing concerns that the merger would concentrate too much power in the telecommunications industry, sources close to the FCC and the industry said. SBC and BellSouth are leading local phone providers in Southern and Southeastern states, and Cingular is also a dominant wireless carrier in parts of those regions. The two commissioners argued for substantially greater divestitures in those areas and for stronger language ensuring that Cingular does not get preferential prices to connect to the land-line networks of its parent companies. In the end, they were able to secure the additional divestiture of six markets beyond those initially proposed, according to a source close to the commission. After an eight-month approval process, Cingular faces the two-year task of integrating the companies' networks, which are built from a hodgepodge of technologies. It must clean up AT&T Wireless's tarnished image, and it must market itself effectively to keep customers from defecting to other carriers looking to take advantage of any missteps. "Like every merger, you'll have skeletons in the closet; you just hope they don't come alive," said Roger Entner, an analyst with the Yankee Group, a market-research firm in Boston. "Cingular must clean them out quickly." The combined company will employ about 70,000 people. Although it may lay off thousands of workers, Cingular said it will not make cuts until next year. The AT&T Wireless brand name will be transferred back to its former parent, AT&T Corp., six months after the deal closes.
Re: Merger Approval Expected To Be Announced Monday Finally...what we were waiting for...I am not excited anymore.
Re: Merger Approval Expected To Be Announced Monday LOL, I know how you feel. We been waiting for so long and now that's finally here, we're like "yeah, ok, so what", LOL.
Re: Merger Approval Expected To Be Announced Monday Man, you just read my brain...LOL! But yeah, of course, I am still happy because now we are a step closer to get M2M to AWS customers (and I know many) and I am also a step closer to finally get good coverage in North NJ.
Re: Merger Approval Expected To Be Announced Monday It's the other way around for me. I know a lot of Cingular customers. I just want to get some solid info on if I will have to buy new phones if I want to switch to a Cingular plan. I hear some saying I do and others saying I don't.
Re: Merger Approval Expected To Be Announced Monday After reading the article, I wonder what the extent of the divestitures will be. Bobolito, do you think they could be substantial? In the 1 to 2 million range? Or considerably less than that? It looks like two of the FCC people got their wish for additional divestitures in the South. The next couple of years will be interesting to watch in the wireless phone world.
Re: Merger Approval Expected To Be Announced Monday I am looking forward to the combination. I have been commenting, for months, that my Verizon service has deteriorated to the point that it is very difficult for me to make a call from my home. With the combination of 2 major providers, I may be able to switch from Verizon, when my contract is expired, and have good service again.
Re: Merger Approval Expected To Be Announced Monday Solid info on that is hard to get. It appears the requirement will be to change your phone. But I believe it will be one of those rules that can be bent. I can't imagine Cingular starting to act like AT&T used to like a brutal dictatorship. There is a technical requirement to change your phone, because when you migrate to a Cingular plan, you will be given a new SIM card and your AT&T phone won't take it because it is locked to AT&T. Also, Cingular wants to eliminate AT&T branding which is currently in millions of AT&T customer phones all over the country because in 6 months they have to give that brand back to AT&T Corp. It may create confusion if many people keep AT&T phones the way they are today. They want you to use Cingular software which is only loaded in their phones to ensure data services work properly as well since the Cingular and AT&T settings are different. Now, why are they not letting you keep your AT&T SIM card for a new Cingular plan? Well, I don't know. It might have something to do with the fact that all AT&T SIMs will have to be reprogrammed and they rather just give you a new one with the new MNC priority lists. Also, since Cingular phones will be locked to Cingular, those old AT&T SIMs won't work in them. However, I believe you will be able to ask them that you want to keep your AT&T phone if you tell them that it is already unlocked and it will take Cingular SIM cards. Now the question is, will the stores be flexible enough to allow this? I'm sure they will allow it in some cases. It just depends on how nice the sales person is. After all, who is to stop you from taking an AT&T branded phone that you bought from Ebay, unlock it and then stick your Cingular SIM in it? Another thing, Cingular will be offering up to $150 for you to trade-in your phone. That means they want to take the phone from you, which is another indication that Cingular doesn't want people to run around with an AT&T branded phone. Don't forget that AT&T Corp. is coming out with its own service through Sprint and they will be selling phones with AT&T branding on it. So it will be confusing for people to see two AT&T phones, one of which works on the Cingular network and the other one that runs on the Sprint network .... See my point? I can already see people trying to stick their old AT&T SIM card into a brand new AT&T CDMA phone that runs on the Sprint network.
Re: Merger Approval Expected To Be Announced Monday But where would they stick it? CDMA handsets do not currently have a place for it... at least until RIUM cards become a reality... or is it RUIM cards?
Re: Merger Approval Expected To Be Announced Monday I've seen it as R-UIM, removable user identity module. Still looks just like a SIM. I'd be delighted to "trade-in" the used ATTWS phone I have for an upgrade credit. COtech
Re: Merger Approval Expected To Be Announced Monday It will probably be a yes! on AT&T/Cingular Sprint though back in May of 2000 they were ready to be apart of WorldCom and the DOJ said NO WAY! be neat to see what they will have to divest and will SBC contest? any person in there right mind would not!
Re: Merger Approval Expected To Be Announced Monday That's the problem! They will take try to put the SIMs in these CDMA phones and there is no place to put the SIM in. That was the confusion I was talking about.
Re: Merger Approval Expected To Be Announced Monday Looks like this announcement will put a soft cap on spectrum holdings. It will be interesting to see where the divestments will be and who will jump on them.
Re: Merger Approval Expected To Be Announced Monday So would I, especially for a $150.00 credit, per phone, I can convince my wife to get rid of her T721.
Re: Merger Approval Expected To Be Announced Monday You're suppose to use a SIM once. It would'nt create too much trash.
Re: Merger Approval Expected To Be Announced Monday I don't get it ... I am just talking about what stupid people could do as a result of the AT&T name confusion.
Re: Merger Approval Expected To Be Announced Monday FYI... E-mail went out to AWS employees on 10-22-04 notifying us that AWS employees would have access to Cingular's training databases within 24-48 hrs. Personally, I'm rather confused. I was under the impression that such things could not happen untl the merger was formally announced?
Re: Merger Approval Expected To Be Announced Monday Andrew J. Shepherd and XFF have their combined CW-AWS cellular map for study. My thought is divest south Texas for sure--no viable PCS competition; which lets them keep east Florida, where Metro PCS, Sprint, T-Mobile, Verizon and Alltel (Jacksonville only) are competing on PCS. What do others think? COtech
Re: Merger Approval Expected To Be Announced Monday Someone on HoFo said on Thursday they started getting training on the Cingular System & that most of the managers have to go to Atlanta for training starting this weekend, I guess the FCC told Cingular & AWE that it had been approved by them & the DOJ & will be announced on Monday but they could start the process going.
Re: Merger Approval Expected To Be Announced Monday I think VZW should buy all those Spectrum to be Divested.
Re: Merger Approval Expected To Be Announced Monday Maybe T-Mobile will be looking into getting it to increase there coverage in these area's.
Re: Merger Approval Expected To Be Announced Monday Unfortunatly we don't know where they will have to diverse spectrum yet, so I was trying to say T-Mobile should go for where they don't have any license & I am sure Verizon will go for area's they don't have any license yet as well. We will hear tomorrow what area's are affected & see what comes of this & how long they have to diverse the spectrum.
Re: Merger Approval Expected To Be Announced Monday True, but we know the areas where the combined company controls 70 megahertz or more of spectrum and that's in Florida and Texas.
Re: Merger Approval Expected To Be Announced Monday Not really....the announcement of the merger is just to make it public knowledge. However, they could've gotten the approval a long time before making the formal announcement. It is only required that they maintain operating as separate entities until they receive approval. Therefore, they can start doing whatever they need to as soon as they receive approval. They don't have to wait until the approval is announced.
Re: Merger Approval Expected To Be Announced Monday News Update: The Department of Justice (news - web sites) will approve the deal on Monday on condition Cingular sells AT&T Wireless assets in 16 markets, including Oklahoma City, Oklahoma, Dallas, Detroit and Knoxville, Tennessee, said the person, who asked not to be named. The Federal Communications Commission (news - web sites), which is expected to approve the deal on Monday or Tuesday, will ask Cingular to sell assets in additional locations to ensure the merger does not affect competition in these markets, the person said. The sales will include places where the combined company holds more than 80 Megahertz of airwaves, the person said. These sales could involve up to 24 markets, sources have previously said. http://story.news.yahoo.com/news?tm...telecoms_attwireless_cingular_dc&sid=95573419
Re: AWE/Cingular Merger News Updates Here.... Just remeber 80 MHz for Cingular is why they lifted the limited on comerical wireless providers. So the FCC can do a case by case basis on what they should do to keep fair market controll. I think 70 metro - 75 rural should be the max for Cingular, but the FCC says 80 MHz. When PCS H block comes out and AWS 1700-2100 MHz I am sure Cingular can move up to a higher level due to more spectrum can will be given to other providers as well as them.
Re: AWE/Cingular Merger News Updates Here.... Justice OKs Cingular-AT&T Wireless Deal 11 minutes ago By HARRY R. WEBER, AP Business Writer WASHINGTON - Justice Department (news - web sites) antitrust regulators cleared the way Monday for Cingular Wireless LLC's $41 billion acquisition of AT&T Wireless Services Inc., a crucial step toward creating the nation's largest wireless telephone company. The merger still must be approved by the Federal Communications Commission (news - web sites). That approval could come as early as Tuesday. Under an agreement with the Justice Department filed in federal court in Washington, Cingular must divest itself of assets in 11 states. "Without these divestitures, wireless customers in these markets would have had fewer choices for their wireless telephone service and faced the risk of higher prices, lower quality service and fewer choices for the newest high-speech mobile wireless data services," said R. Hewitt Pate, assistant attorney general for the Justice Department's antitrust division. Cingular is an Atlanta-based joint venture of BellSouth Corp. and SBC Communications Inc. of San Antonio. Its acquisition of Redmond, Wash.-based AT&T Wireless would create a cellular phone colossus with 46 million customers, topping the 37.5 million customers of Verizon Wireless and paring the number of national wireless phone players to five. Together the two companies have about 70,000 employees, although layoffs are expected if the merger goes through. The settlement requires the merged company to divest assets in parts of Connecticut, Georgia, Kansas, Kentucky, Louisiana, Massachusetts, Missouri, Michigan, Oklahoma, Tennessee and Texas. These assets include wireless services businesses and radio wave spectrum licenses. The Justice Department was joined in the court settlement by the states of Texas and Connecticut. A judge still must sign off on the agreement. Last week, Cingular reported that operating profits slipped 5.5 percent despite gains in both subscribers and revenue. AT&T Wireless posted a 25 percent drop in third-quarter net income. BellSouth transferred several of its assets in Latin America this month, to Spanish telecommunications company Telefonica SA, to raise cash needed for the deal. http://story.news.yahoo.com/news?tmpl=story&u=/ap/20041025/ap_on_bi_ge/cingular_at_t_wireless