AT&T vs Verizon battle heats up
AT&T vs Verizon battle heats up
By Tammy Parker
If they truly take up the competitive challenge, two
The die was cast on December 29th, when the US Federal Communications Commission approved AT&T’s buyout of BellSouth, its partner in top
The buyout was valued at $67bn when announced in March 2006, but a subsequent 25 per cent run up in AT&T’s share price boosted the deal’s final value to $85.5bn. The merged AT&T is flush with an impressive market capitalization of more than $220bn that might be used to develop new service, improve its network or buy any needed spectrum.
The new telecom behemoth’s biggest competitor in the
That will help raise the competitive bar given that integration and convergence is what the AT&T-BellSouth merger was all about. AT&T is phasing out the Cingular moniker, and immediately after the merger closed, AT&T announced it intends to integrate all of its wireless and wireline IP networks, combine product portfolios and merge customer care capabilities. The company’s new AT&T Unity calling plans provide unlimited wireless minutes for calls to and from AT&T landline and wireless phones.
AT&T has also said it intends to sell ads on mobile handsets, internet TV and broadband networks.
The planned integration of mobile services, TV and broadband raises an interesting point. Though it’s known that AT&T has been looking at partnering with parallel mobile TV networks such as Qualcomm’s MediaFLO or the DVB-H network being built by
AT&T’s current mobile video service enables customers to watch video highlights from top media outlets. But it will need more than that if it is to market an advanced mobile TV offering in conjunction with AT&T’s expanding fibre-to-the-node Project Lightspeed service, which is in about a dozen cities.
Verizon Communications leads AT&T in IPTV, with its FiOS fibre-to-the-home platform having attracted 118,000 customers at end-3Q06, and it is moving quickly to launch broadcast mobile TV using Qualcomm’s MediaFLO USA network in Q107.
During a January 7th press conference on the eve of the International Consumer Electronics Show in
Denny Strigl, Verizon’s president and chief operating officer, said the carrier is leading the way in the next revolution of television: “with the strength of our fibre networks, we have transformed our business.”
The plan initially involves letting mobile customers remotely program their DVRs from their handsets, much like a service planned for later this year by a joint venture of Number three mobile operator Sprint Nextel and four cable TV operators.
Meanwhile, the top three
And the biggest handset announcement so far in 2007 from the new AT&T does not have a 3G component. The operator signed an exclusive, multi-year partnership to market Apple’s iPhone, which will not arrive until June, and that handset will not have WCDMA/HSDPA capability but will instead use EDGE and wifi networks for data connectivity.
Like AT&T’s other mobile music services, this iTunes-powered offering will not offer over-the-air downloading, only sideloading from a PC. That contrasts with the approach of Verizon Wireless, which has offered OTA downloads and sideloads of music for more than a year. According to one source, the vast majority of songs downloaded through the V CAST Music Store are sent over-the-air to users’ handsets rather going to a PC for later sideloading.
Meanwhile, AT&T’s merger with BellSouth may have the unintended consequence of strengthening WiMAX offerings from either Craig McCaw’s Clearwire or Sprint Nextel. In order to secure FCC approval for the merger, AT&T agreed to divest BellSouth’s 2.5GHz wireless spectrum holdings, which would fit nicely with spectrum holdings of the two aforementioned WiMAX networks, which are currently being built out. Both Clearwire and Sprint Nextel have signaled interest in buying the 2.5GHz spectrum licenses from AT&T.
