Verizon to buy Alltel for $28.1 Billion

So you look forward to paying perhaps 50-100% more for your cell phone bill, hmmm.

Roaming agreements keep prices low for consumers, and also,
it literally does make your potential coverage area larger.
Native footprints are good, but native footprints with roaming agreements are alot better.

Even the best native footprint will still have many many weak areas,
this is where roaming agreements will save you in many cases.

 

i agree 100% he should have gone to V to start with, but that's ok i'm calling
the fcc monday also , so i'll just kill his vote for support.

 

It's real easy to forget, but carriers compete in terms of having the best coverage, as well as the best price, until they're satisfied with their customer base or coverage in an area. So less competition will lead to a poorer quality of service. Even in areas where alltel, or Dobson, or SunCom didn't compete. Verizon and at&t having to compete against those providers in other areas led to competetive rates, and standards of service.

And once Verizon and/or At&t does reach the point where they don't need roaming agreements, that may be a huge blow, and perhaps an eventual downfall of Sprint and T-Mobile. But then, maybe we'll see gov't regulation of the industry or even the wireless baby bell breakup. I actually do think that the government would step in with regulation to prevent Verizon or at&t monopolizing one of the other players out of the game.

And it may not happen. This may be a great thing for VZW customers and the industry in general. When you combine the best Verizon networks and the best alltel networks, nobody is going to touch this provider in terms of coverage in many, many markets across the nation. The airwaves probably do only support 4-5 national carriers. I'm sure the people that ran alltel will cash out with millions. In fact, they actually did several months ago by selling to TPG and GS. The main people I feel sorry for, are the ones who had alltel service, or even Dobson or SunCom, and were satisfied with coverage, but will now have to pay more for the same thing. And I'm also just concerned because using history as a guide, consolidation in the wireless industry has not been good for customers or employees, and I fear that Verizon may not show many rural customers the same commitment to coverage and data in the future that alltel did.

But given the fact that alltel was looking for a way out of the game it appeared, and being saddled with 22 billion in debt from the last buyout, a transition to Verizon is probably the best thing. I know that many would be furious with the level of customer support, and coverage in some places given by Sprint. Then there'd be some iPCS lawsuit over it. At&t and T-Mobile would also present far more complications that would probably be worse off for most customers.

 

Come on now ctk74 was just expressing how he/she feels about this don't pull apart what he/she feels is right just because you disagree.

I just feel if someone is for this then they are getting shot down please have respect.

I think the assumption of higher prices and this and that being taken away are valid although nothing is set in stone until the final t is crossed and i is dotted.

 

Why is everyone surprised that this "private equity group" sold out so quickly?. I'm betting a deal like this was planned from the start. I wouldn't be surprised if they were secretly looking for a buyout suitor as soon as the ink was dry on their deal for Alltel.

Why is it also a surprise that this deal happened? Alltel certainly holds more worthy cards than US Cellular or any other smaller carrier. I bet if Sprint wasn't in the morass they are right now, they probably would have made a play for Alltel themselves. Would everyone be complaining the same way if this had happened? I wonder...

I agree with everyone that the loss of competition is not a good thing, but sadly mergers of this type are common business these days. I have little faith things will change any time soon.

I shouldn't be surprise how much rancor I've read here and on HoFo from people who dislike Verizon, but they aren't the devil incarnate for everybody. For all of the complaining people do about them, they continually grow with subscriber additions, they have a low churn rate, etc.

Verizon is not perfect by any means, but they work for many people, myself included. Though I'm not always thrilled with the things they do, I can't complain after more than a decade of solid service.

Frankly AT&T, Verizon, T-Mobile, Sprint, Alltel, USCellular, MetroPCS, Cricket, and every other MVNO/Cell company out there SUCK!! NO carrier is perfect.

So Verizon has just bought Alltel. Deal with it. Unless you can come up with some major billions to buy them out, there isn't much anyone can do about it now.

 

I think that is well said Mike.

 

The only real solution to competition in the US is a realistic system for managing spectrum. The FCC pretends that it wants competition but than encourages massive consolidation. If we want real competition than the FCC needs to setup five (or so) national licenses and include a rule limiting you to just one of them. This would acknowledge the way the market is really going and ensure that there'd still be a realistic level of competition and less spectrum hoarding.

It'll never happen though.

 

I'm not surprised that this happened at all. VZW has had its eyes on Alltel for a long time. For me, I would finally get to be on "The Network" and talk to those that have VZW (many of my buddies are using them). I currently cannot get a local number with Verizon, but if the merger is approved (which is expected to go through), that should change in the future. So, I kinda look forward to that. I know it's not going to be positive news for everyone, and hopefully, the negative impact will be minimal.

50-100% increase in the bills? I seriously doubt that much. We'll see.

 

Thanks RJB. As a proponent of a free market I don't subscribe to the sky is falling mantra that many on this board automatically assume with any merger talk. The fact of the matter is that Verizon and Alltell really were not major competitors. The U.S. wireless landscape will still remain very competitive with 4 nationwide carriers (Verizon, ATT, Sprint and T-Mobile). It is obvious by the rates of mergers that this country is not able to support 5+ nationwide carriers considering the massive investment that will be required to advance in technology. If the prices are too high with Verizon after the merger, the consumer will make the choice and switch. It seems that cell prices have actually been coming down recently, esepecially with the introduction of unlimited plans.

 

Do you really think that the FCC cares what any of us have to say anyway? This deal will be approved with some divestitures but there is no way in this econmic climate it will be killed. Aside from the ramifications from cellular users, the assumption of $27 billlion debt by a high quality company like Verizon will aid the credit markets and is certainly another factor that may be considered.

 

This is a ridiculous statement.

The merger in the end is good for coverage. Good for vzw customers. Bad for Alltel customers money wise most likley. But there is a potential for Verizon to implement some of Alltel's good aspects.

It's free market and capitalism and I love that. I just hate the fact that my prices will be going up and my circle most likely disappearing.

 

You should probably wait for more details. Verizon has surprised us quite a bit as of late. You just never know.

Besides, you'll be able to keep your current plan most likely since it'll be grandfathered.

 

I haven't been able to get Alltel service anywhere I've ever lived, so I've never considered them competition. This is just more native coverage for me like all the other mergers and acquisitions. Through them all, my service has gone from $35 for 250 minutes regional coverage with no roaming, no M2M to $40 for 450 minutes national coverage with roaming and M2M. So not only has my service greatly improved, but the cost has risen slower than inflation.

If you had Alltel and are now faced with higher costs, then consider the idea that those low costs are why your carrier couldn't stand on its own and was sold off.

To everyone calling the FCC: its not American Idol--you don't get a "vote". You can express your concerns, but unless they have some legal basis, your carrier preference is not going to sway the FCC.

This merger will reduce costs for VZW more than it will decrease competition. Towers are EXPENSIVE--and they're not free to maintain once you put them up. When AT&T wants to buy T-Mobile, or VZW thinks they can buy a nationwide competitor like Sprint, then I'll take issue.

 

What plan are most of you Alltel subscribers on that your prices will go up? I understand that anyone extensively using My Circle will probably face a larger usage of anytime minutes, I'm just curious. I glanced at the Alltel rates and it seems like My Circle wasn't available on the $40 plan. I don't talk on the phone a lot and neither does anyone I know, but I also know that we're all lower than the ARPU.

 

i'm on the 79.99 nationwide family plan, 1000 shared min..1000 text/pic's message's
per line (2) 10 my circle,kb;s are paid for by min. not $, i just entered a 2 yr. contract
2 month's ago, vzw WILL honor this contract as is,or i'll cancel and pay no etf.

 

I have 2 Alltel accounts each shared by two different people.
One is the Nat'l Freedom 900 and the other is Nat'l Freedom 1400, each one has a line added for $10.
(total of 4 people on the 2 accounts)

Each account gets 10 My Circle numbers, and one line on the 1400 gets unlimited text/pix/video for $20 more.

My Nat'l 900 plan on one account, advertised at $69.98 totals an average of about $82.00 per month,
and my other account, the Nat'l 1400, advertised at $89.98 totals an average of about $115.00 per month.

So I pay about $50 per person, per month, or about $200 per month,
which isn't that bad per person.

My contract expires in mid-September of this year, so hopefully I'll renew it
(and get 2 My Circle Bonus Numbers) before this deal closes.

 

Alltel was doing well when it was taken private. It not a matter of being unable to compete. The shareholders decided they wanted their money quickly rather than over the long haul. The private equity firms who took it private couldn't afford the purchase price and had to sell.

 

I just hope my prepaid plan is kept. I use my phone very little. I pay less than a dollar some months. I'd hate to lose that.

 

One thing I see happening is that FCC will require divestiture of one of the 850Mhz blocks in rural markets where Verizon would own both 850Mhz blocks. The same thing was required of AT&T/Cingular merger in a few areas.

 

lets look at this realistically......a Verizon/Alltel merger is a very good thing........and I agree with what Cheddar has pointed out..........if all those subs are gonna be on the same company you have two major companies (Verizon and AT&T) and two minor companies (Sprint and T-Mobile)....

steps need to be taken to generate competition......there was a PDF presentation posted earlier about the whole merger and an overall look at it........one of the steps was eliminate redundant towers.......that should be done.......and there needs to be A LOT of divestitures.........and I mean a lot..........im convinced that instead of the big companies being gobbled up.......the little ones should be divested some licenses to make them bigger.......metroPCS has potential..........SoLINC......USCC......they all have the potential to be bigger if the FCC were to give them that oppurtunity.......we dont have to lose competition over this.......these arent Verizon's airwaves or AT&Ts airwaves or Sprints airwaves or w/e

these are the airwaves of the U.S.A. and they are to be shared and there are antitrust laws in place to eliminate the "my horse is bigger than your horse" issues..........if Verizon and Alltel were to merge they should give up some spectrum to small companies to get them on their way........Verizon would still have drastic increases in coverage but they wouldnt be strangling the regionals...

i think all Sprint needs to do is push the roaming agreements that are in place because if they last til 2016 then that will be plenty of time for them to reconstruct their backbone............reband iDEN and turn it off if necessary..........have WiMax well on its way and when the roaming agreements are up they will probably have to make new ones but Sprint will have QChat at that point and they will be getting ready if not well enough along at that point to constructing their LTE network.

keep in mind that Sprint has a big advantage with SprintLink.......it permits them to support more and once its all up to date and bottlenecks are eliminated theres a lot that they can do with it

 

Do you think that is an absolute? I sell Vzw in Bishop, CA and Mammoth Lakes, CA. Vzw and Alltell are by far the dominant providers here among locals. ATT and Nextel also own network here. Our population is about 30,000 regionally. Given that, I was hoping that divestment would not be required (low population and very isolated area).
If divestment were required, does history give us any indication of how it would occur, i.e, what would have to be spun off? Actual network? Customers and network? Alltel customers or Vzw customers? And, what provider(s) would be the likely suitor(s)?
All opinions welcomed and appreciated.

 

I wonder if the FCC would force Verizon to divest all of Alltel's GSM licenses. AT&T could score some licenses for rural coverage where they roam now.

 

It's a combination of several factors: market population, number of competitors, and amount of spectrum owned. If Verizon intends to own both 850Mhz blocks in a rural area where AT&T, Sprint and T-Mobile are weak or non-existent, you bet the FCC won't let Verizon get away with it. It's like allowing the only two real competitors (Alltel and Verizon) merge to become a true monopoly for that area. In a case like that, Verizon would have to sell one 850Mhz block to another carrier. Like I said, during the Cingular/AT&T merger, they had to do the same in a number of markets in TX, OK, and CT for the same exact reason.

 

here is a copy of the email i got this am. from a question i ask alltel:

Dear Mr. David B.,

Thank you for your inquiry. My name is Susan and I will be happy to assist you regarding your account concerns.

Alltel is in the process of being purchased by Verizon. We appreciate your input and value your support.

Your rate plan and coverage area will remain the same until the transaction closes. When the deal closes you will be able to take advantage of the combined Alltel and Verizon networks

Your current bill and bill format will remain the same. Your current terms and conditions will be honored when the two companies combine. Verizon uses the same technology, as Alltel so there is no need to worry about whether or not your handset will work on the Verizon network.

Please let me know if I can be of further assistance. Thank you for choosing Alltel.

Sincerely,

Susan
Alltel Online Customer Service


then i called the local alltel store and ask them if they where going to remain
open after the sell goes though, to my suprize they are not only going to
remain open they will change to the vzw corp.store here in town.the manager
also told me that she couldn't say if my package would stay the same,
also called fcc to air my concerns and they where vary interested in what
i had to say.


lord help all the alltel customers

 

Thanks for the reply. Wishful thinking perhaps on my part. I would love to sell in a monopolistic market. $$$
Over here Vzw is on the B side and Alltel is on the A side. Does anyone know if one side was divested, would the customers go too or just the physical network? And who would be the likely suitor, Sprint, US Cellular, other?

 

I think you have to expect that AT&T would be the number 1 suitor in any market in which Alltel/VZW own the A and B sides. AT&T has the money whereas a company like US Cellular probably does not. Not to mention with a name like AT&T it is easier to move into a new market (or add spectrum in a market where you are 1900MHz-only) than it would be for a smaller company to come in and have to build name recognition.

Sprint and T-Mobile would seem unlikely candiates given that they only operate 1900MHz networks (for the most part).

 

I agree with you here I dont see anyone but ATT getting the 850.

 

For everyone that is talking about calling the FCC or who has already called...do yourself a favor, and instead of calling, write a letter. Not that I think it will really make a difference anyway, but something in writing carries a lot more weight when dealing with the FCC.

 

same here in my area

 

I thought it might be Spirnt because Alltel uses CDMA. Around here Sprint users roam off of Alltel's network @850Mhz . We don't have any PCS here. Also, ATT already owns spectrum here @ 1900MHz. It seems that they have choosen to "underserve" our market. In fact, after renewing tower lease agreements with the USFS twice, the USFS refused to renew the leases because ATT did not build in a timely manner.
I hope its not ATT, thats real competition.