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Verizon to become largest wireless carrier

Posted Jun 05 2008, 03:15 PM by Kim Peterson
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Verizon shares are up 5% today after the company said it will buy Alltel for $28 billion, which includes assuming about $22 billion in Alltel debt. Verizon will surprass AT&T to become the largest wireless carrier in the U.S. MocoNews says Alltel is an industry pioneer: with only 13 million subscribers, it tests new services quickly and acts almost like a laboratory for everyone else.

Snatching up an innovative company that isn't afraid to break new ground is important as Verizon competes with an increasing number of rivals across multiple technology fronts. Verizon picks up some assets as well; Alltel serves 57 rural markets that Verizon had no presence in.

The transaction is a bit tricky, since Verizon may have to offload some of Alltel's markets to get regulatory approval. Still, Verizon expects the deal to be cash-flow positive in the first year despite integration costs that could run over $1 billion.

Here's what analysts are saying about the deal:

"You have to see it in context of how Verizon is trying to reinvent itself as a wireless versus a wireline company. The more they do, the faster they do it, the better.” -- Craig Moffett, Sanford C. Bernstein

"This is a way of getting growth from a market that's becoming fully saturated and beginning to slow down," -- Joseph Bonner, Argus Research

"This deal would help Verizon Wireless grow by acquiring a new customer base. Not that it matters much anymore, because they are all so big, but this deal would give Verizon Wireless the number one spot in the rankings." -- independent analyst Jeff Kagan

"A deal like this would make Verizon somewhat bigger than AT&T. It's looking, more and more, that there's the Big Two and everyone else." -- Julie Ask, Jupitermedia

"Generally speaking, you will continue to see consoldiation among the smaller players. (The wireless industry) is a more limited field than it once was." -- William Power, Robert W. Baird

Comments

 

im sorry but i dont concur with david from tampa ive be a disatisfied customer , when i lived in NY it was great but i live in Florida now and i guess i fall in the category from what Norma Hill said that "some problem cant be fixed"; i live in miami and i have numerously complaint of the dropped calls and signal strength on where i live. and they have offered no solution.  customer service is good overall compared to other carriers.

Verizon is a big company.  I make 65k a year selling wireless services which is not so bad.  The benefits are great and you receive benefits on he first day of training.  I do not know of any other company that offers this.  However the work at Verizon is very stressful.  Dealing with people who for the most part walk into the store with an enormous sense of entitlement is enough to make us want to run and apply elsewhere.  The location I work in is inhabited mostly by well educated and very wealthy people.  One would think these are the greatest people to deal with but the they are not.  They are the most spoiled, demanding people I ever met.  There is nothing humble about them.  They are horrible tightwads although they live in  million dollar homes and pull up in fancy  cars.  The majority walk in with an overblown ego and sense of entitlement.  They look down at everyone and expect to get things for free and after you cave in they might talk about the companies they own and their trips around the world that they are preparing for.  Our company threatens our job security if we do not sell accessories and data services like text messaging or internet access. They tell us that we must concentrate outward on customer needs and desires but then turn around and threaten our jobs if we do not meet our quotas.  Verizon is a bully

Well said Norman Hill. I am also part of the Verizon Wireless customer service team. I must say that some requests from customers are incredibly ridiculous, but we still handle them with the most professionalism and always offer the customer an option in their favor, more than one on many occasions. What some customers don't seem to understand is that we give out  over 30 million dollars in credits per year just to maintain our customer base happy. That is not even including what we give away to obtain new customers. Customers seem to have the idea that because they are our main employers, we are forced to process every transaction they request with no questions asked. What they don't always seem to understand that we are a business that provides a service for a profit. We are not a charity. I am the customer care  rep. at an extremely busy location and have more than patience with all of my customers. So for those whom comment that our customer service dept. is not the best has not dealt with me yet

Dropped calls are a way of life when you live at the end of the line: No Service, Extended Network etc.  The fine print  in the customer agreement excuses the carrier and permits them to nic you for dropped calls, always rounded to the next minute.

Wow, I have read some interesting comments on here.  I have never met you personally, but I can see that there are some extremely spoiled cell phone people on here.  Did you know that in some of the most rural areas the only service you can get is alltel or vzw??  I have had vzw for more than 10 years.  I have also had service with other carriers.  I will not say that I have not had problems with vzw, but nor will I say that I have not had problems with other companies.  I believe that a merger is a wonderful thing for all concerned.  Alltel customers will get out of the back woods and vzw will get in.  Dont get your undies in a bunch, companies buy and sell all the time, and most of the time you never even know.  Do yourself a favor....dont bash verizon because they do provide quality customer service.  If most of you verizon haters would adtually come off your high and mighty " I am deserved something" attitudes.  You people are ridiculous.

written by a loyal and long time customer!!!

I am a verizon customer have been for years. I think Verizon buying Alltel should improve both Verizon and Alltel services.

What are other thoughts ?

I am an Alltel customer and have been for many years, and like most Alltel customers I am not sure of what is going to transpire from the buyout .  But I do agree that we should give Verison a chance.  Whats the worse that can happen?, we don't like them and switch to another company?  Exactly!!  We can all hope for the best and wonder if our plans are going to change or are they going to stay the same but we first MUST give them a chance.  We can not stop the buyout that is out of our hands but we can as Alltel customers be patient and see what happens and as Verizon customers you can understand all of our concerns and our loyalties to our company.  There is bound to be good and bad in both companies lets all hope that from 2 companies we get 1 good company!!!!

I am currently a customer of Verizon, that had switched from Alltel for absurd billing issues (that is one company that will nickle and dime you for anything your worth) After reading through these comments, it seems a lot of people have done little or no research on Verizon Wireless.  By not understanding that you CAN change your plan at anytime with no contracts, you CAN prevent high bills from happening, they DO offer promotions and credits for customers and for businesses.  As far as contracts go, wireless companies loose an average of $200 to $400 per phone whenever a customer signs up new or for an upgrade.  By providing contracts it allows for these discounts to be applied, you have the option to not have a contract but that free phone becomes $200, and that is what these companies paid to have that phone on the floor.  I have had fantastic service from Verizon, they are the only ones that could ever explain a bill.  Alltel said "I'm not sure why you have a $1200 bill. Did you travel to New York?" Hmm I would think you would be able to tell.  If its nationwide can't I use it there? Its in the nation! And to be completely honest, don't be cheap.  When your cheap YOU create surprises for YOURSELF, that is going to be with anyone you choose to select as your carrier, pay the $20 extra and double your minutes.  Its for piece of mind people!

I work for Alltel in-store sales. I can say with my years of experience that most of the complaints customers have, directly due to billing, is their own fault. Like every other wireless employee has said: check your minutes, do some research, and then select a plan/phone. Alltel has offered me and my husband superb service as consumers and an employee through different parts of the country. I do wish that Verizon is the same. I certainly would not complain abt a merger that may increase my pay ;-)  PS to Verizon employee: the wireless industry is not a bully. You just have to do the job required (like sell).

Verizon has the best customer service i ever dealt with.

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