Tag Archives: Verizon Wireless

An illustration in market disconnect

Lucent Logo, bearing the "Bell Labs Innov...

Lucent Logo, bearing the “Bell Labs Innovations” tagline (Photo credit: Wikipedia)

By George Mattathil – Forbes article, “How AT&T Can Go Shopping In Europe And Keep Its Credit Rating” by Maggie McGrath, provides an illustration how the financial markets are disconnected from reality and creates havoc with real businesses.

AT&T no longer has any competitive advantages, except its ability to borrow huge amounts of capital from financial markets. For starters, AT&T is not the company what most people think it is. Financial wizardry has reduced it to “at&t.”

Financially driven decision-making started at the original-AT&T with the decision to keep the then profitable long distance business and divest the technology (Lucent, Avaya, Agere) and the customer-connecting access networks (Baby Bells.) AT&T then followed it by another disastrous decision to buy TCI cable network, since it no longer had customer-connecting networks. As the original fantasies did not materialize, AT&T was forced to spin off the cable business to Comcast, and lost billions in the process. The result was one of the reconstituted Baby Bells, SBC, bought AT&T and renamed itself as the current ‘at&t’.

SBC had been mirroring the original-AT&T financial strategies for maximizing earnings — such as downsizing, shutting down research, not investing in network upgrades, etc. As an example, after the acquisition of Pacific Bell by then SBC, market leading research activities at Pacific Bell were terminated.

Current ‘at&t’ financial wizardry is based on customer-connecting networks of the constituent Baby Bells of past SBC.

Vodafone, in turn, benefited from Verizon’s financial wizardry. An estimated $20 billion investment by Vodafone in Verizon Wireless has turned into a $145 billion payback.

Seems the success of network operators is not based on how well they run their network operations, but how much they can borrow — a lesson learned probably by watching how Washington operates!

Impact of the financial wizardry by network operators is not limited to news generation, or even contained within their respective organizations. Network being a key enabler for economic activity, the costs and pain of network operator missteps are distributed to their customers and the entire economy. But the financial benefits from the wizardry are seldom shared, except, may be, as increase in share price.

Another impact, not easily identified, is the current turmoil at Alcatel-Lucent. AT&T used to be a major Lucent customer. But plans to migrate their infrastructure to VoIP (Voice-over-IP) make the current infrastructure and major Alcatel-Lucent product lines redundant. This has made it necessary for Alcatel-Lucent to reorganize their business operations. And placing a question mark on its future.♦



AT&T to buy Verizon spectrum for $1.9 billion

1980s Dodge Ram Van Verizon

1980s Dodge Ram Van Verizon
(Photo credit: Wikipedia)

By Grant Gross – AT&T will buy mobile spectrum in the 700MHz band from Verizon Communications for US$1.9 billion.

In April, Verizon pledged to sell off two 12MHz blocks of mobile spectrum in the 700MHz band, including the B block, if U.S. regulators approved its purchase of spectrum from a group of cable providers. more> http://tinyurl.com/bchy4bj

Isis finally launches mobile payments service in two cities

Salt Lake City - Salt Lake Temple

Salt Lake City – Salt Lake Temple
(Photo credit: Kwong Yee Cheng)

Reuters – Isis, formed by Verizon Wireless, AT&T Inc and T-Mobile USA, is a mobile wallet service that allows consumers to make payments by waving their phone at a check-out terminal, instead of using a plastic card.

Starting on Monday (Oct 22) the company said the service was available in Austin, Texas, and Salt Lake City, Utah, with support for the service on nine different handset models.

The service will work on payment cards from American Express, Capital One as well as an Isis cash card. more> http://tinyurl.com/8pgbk32

FCC wants to know if Verizon is warehousing spectrum

By Kevin Fitchard – The U.S. Federal Communications Commission is curious why Verizon Wireless bought a bunch of 4G spectrum back in 2008 but now plans to sell it.

Carriers like T-Mobile and Sprint, along with a slew of consumer advocacy and telecom industry groups, have criticized the deal, claiming Verizon is merely trying to lock up the most valuable 4G airwaves.

Verizon is in a tricky situation here. Those A and B block licenses don’t fit well into its LTE plans for multiple reasons: the goofy configuration of the 700 MHz band, the fact that they don’t form a nationwide footprint and interference concerns in A block. When Verizon bid on them and won them in 2008, it probably wanted them as insurance – or to keep them out of AT&T’s hands. It was hoping something better would come along, and it did — in the form of nice big gift-wrapped package of clean nationwide airwaves delivered by its new cable buddies. more> http://is.gd/fjiGqx

CTIA 2012: A non-stop spectrum beg-a-thon

CTIA – The Wireless Association

CTIA – The Wireless Association
(Photo credit: Wikipedia)

By Brad Reed – This year’s CTIA wireless tradeshow in New Orleans seemed less like an industry gathering at times and more like an infomercial dedicated to forcing the government’s hand to free up more spectrum. Start with CTIA President and CEO Steve Largent, who dedicated the vast majority of his introductory keynote address to discussing the challenges carriers will face if they don’t get fresh spectrum to use within the next few years.

“We simply need more spectrum,” he said. “Getting more spectrum is the No.1 goal of CTIA.”

Later that day, Verizon Wireless CEO Dan Mead took up the baton and similarly lobbied for the government to open up new airwaves for mobile data services.

T-Mobile CEO Philipp Humm, meanwhile, said “the need for spectrum is urgent since it takes a while for new spectrum to be auctioned off and put to use.” more> http://tinyurl.com/79xbgp2

Rivals seek delay of Verizon cable deal review

1980s Dodge Ram Van Verizon

1980s Dodge Ram Van Verizon (Photo credit: Wikipedia)

By Jasmin Melvin – Sprint Nextel Corp (S.N), DirecTV (DTV.O) and others asked U.S. communications regulators on Tuesday to suspend their 180-day clock for reviewing proposed multi-billion dollar airwaves deals between Verizon Wireless and several cable operators.

The Federal Communications Commission is on the 96th day of its review of Verizon Wireless’s plan to buy about $3.9 billion worth of wireless airwaves from cable companies including Comcast Corp (CMCSA.O) and Time Warner Cable Inc (TWC.N).

The cable operators would be allowed to resell Verizon’s mobile service as part of the deals. Verizon Wireless is a venture of Verizon Communications (VZ.N) and Vodafone Group Plc (VOD.L).

Verizon rivals Sprint, Deutsche Telekom AG‘s (DTEGn.DE) T-Mobile USA and MetroPCS Communications (PCS.N), have all complained to the FCC about the bigger company’s cable deal on concerns that it would give too much market power to the already dominant company. more> http://is.gd/n1dCHe

LightSquared: Going from bad to worse

By Marguerite Reardon – Things are not looking good for LightSquared, the wireless startup that had planned to build a nationwide wireless broadband network.

Today, Reuters reported that the company said it plans to cut 45 percent of its workforce to conserve cash.

LightSquared has been fighting an uphill political battle for the past year to use 40MHz of wireless spectrumit owns or has leased to build a nationwide wireless broadband network that will compete with AT&T and Verizon Wireless. The company received a conditional waiver to use its spectrum to provide terrestrial-only services last January.

But last week the FCC pulled its conditional waiver stating that there were still interference concerns with GPS signals. more> http://is.gd/JaZPV6