Wednesday, July 9, 2008

AT&T Without Alltel?

Much has been discussed about the pros & cons of the upcoming Verizon Wireless-Alltel merger. We wonder what will happen to AT&T coverage after the deal is done. Much of AT&T's rural roaming coverage in the western US is provided by Alltel. Yes, they have an extensive GSM network...a byproduct of their purchase of Cellular One/Western Wireless.

As Verizon's most direct competitor, AT&T could either be offered some of Allltel's precious spectrum and cell sites, or, they could have the entire Alltel GSM network snatched away. Very few people in the industry have anything to say until they see what Verizon will need to give up to get the deal approved by the feds. Verizon says only a small percentage will need to be divested.

We have put together a map showing AT&T's coverage without Alltel. Since we don't know the extent of AT&T's actual roaming on Alltel, we took the extreme example of drawing up a map that excludes all roaming partners in the western US. Fortunately, AT&T has a number of possibilities to keep this from being the disaster it looks like on the map. They can change roaming partners in some areas, and they have lots of of their own PCS (1900 MHz) spectrum available to construct their own cell sites.

Some of these 'repairs' can be made quickly, and others, like adding new cell sites, could take years. But AT&T can't consider changes until the deal shakes out. There's also the possibility that Verizon, either by choice or by mandate, could just leave things as they are. It wouldn't be a bad thing to receive a nice big check for roaming charges from AT&T and T-Mobile each month. Give a little and Take a little, right?


Anonymous said...

in TX AT&T now that they own dobson has towers all the way across interstates 10 and 20 however on 40 this would leave a gap of coverage from the NM, and TX lines almost all the way into Amerillo. I think their biggest issues will be in the dakotas, MT, ID, NV and UT.

Oz Andrews said...

While there aren't any more carriers AT&T can buy to give them the needed coverage, there's lots of spectrum, either their own or some to rent. I hope they have all their 'what-if' plans ready.

Faith Baptist Church said...

Well, there are a few they could buy, mostly small outfits. Not sure if they would need the coverage at this point but they could offer West Central Wireless a nice deal on their GSM network, pushing the company to become CDMA-only (Five Star Wireless). But probably not; most of the area is former Dobson CelOne.

However in Montana they could always gobble up yet another CellularOne (formerly Chinook Wireless). Plus, Verizon's gonna hafta divest something to do this Alltel merger, right?

Anonymous said...

Although Verizon and Alltel overlap in some areas the areas in which the loss of GSM would be most noticeable they don't. Also if the Alltel GSM network were to disappear T-Mobile customers had better hope that AT&T decides to get friendly with them again as this would leave them with major gaps where AT&T would be the only provider left such as I-10 from east of El Paso to Sonora (350 Miles) and to Odessa on I-20 (305 Miles) just to name a few.

Anonymous said...

What about the 10 year agreement that was signed just a year or so ago between AT&T and Alltel? Could AT&T take Verizon to court and have them forced into honoring the original agreement as a condition of purchace?

Oz Andrews said...

Ah yes, Alltel does have an contractual obligation to provide GSM roaming service, some contracts don't expire until 2012. So, for up to 4 more years things may not change, or less when the deal gets completed. Can AT&T make adjustments that quickly? Our hope is that won't need to, we are really only peeking at a worst-case scenerio.