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Verizon to buy Alltel

Dan Grech Jun 5, 2008

Verizon to buy Alltel

Dan Grech Jun 5, 2008


Bob Moon: If Verizon gets its way, it’ll have another 13 million cell phone users on the hook, so to speak. The wireless giant is buying regional carrier Alltel for $28 billion. It’s a deal that would push Verizon past AT&T to become the nation’s biggest cell phone company.

Marketplaces’ Dan Grech has more.

Dan Grech: A combined Verizon-Alltel would have more than 80 million subscribers. That’s nearly one out of every three wireless customers nationwide.

Telecom analyst Scott Cleland says Alltel offers Verizon the territory it’s been looking for.

Scott Cleland: This is a hand-in-glove fit. Verizon has a hole in the heartland of the country, where Alltel fills in.

Cleland says the combined company would bring high speed Internet access to more remote areas of the country and it would give Verizon millions of new customers for services such as web access for mobile phones.

Cleland: Wireless service is a scale game. You have to have the spectrum capacity to serve people and to provide high speed Internet access. That is a multi-billion dollar endeavor every year to just keep up with demand and technological innovation.

But some industry watchdogs say the deal could hurt consumers.

Gigi Sohn: Less competition leads to higher prices, less innovation, less consumer choice.

Gigi Sohn is president of Public Knowledge.

Sohn: If you’re going to have continuing consolidation, you have to ensure that those networks are open and accessible to all devices, to all applications and to some new small competition.

The FCC still needs to review the merger. Verizon says it hopes to the close the deal by year’s end.

I’m Dan Grech for Marketplace.

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