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AT&T Buys More Alltel Operations For $780 Million 28

Posted by Unknown Lamer
from the savings-passed-onto-board dept.
adeelarshad82 writes "AT&T has purchased the U.S. retail wireless operations of Atlantic Tele-Network Inc. (ATNI) for $780 Million. Alltel operates under the Alltel brand in several markets. The acquisition includes wireless properties, licenses, network assets, retail stores, and about 585,000 subscribers. It also includes spectrum in the 700 MHz, 850 MHz, and 1900 MHz bands, and that's likely the big draw as the carrier continues to build out its 4G LTE network. If the deal is approved by the FCC and Justice Department, AT&T expects it to close in the second half of 2013."
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AT&T Buys More Alltel Operations For $780 Million

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  • Competition (Score:3, Insightful)

    by cbhacking (979169) <been_out_cruising-slashdot@@@yahoo...com> on Wednesday January 23, 2013 @02:20PM (#42671751) Homepage Journal

    Let me guess... this move, by the second-largest US carrier (and largest GSM carrier in the US) is supposed to "improve" competition, just like their last attempt?

    • Re:Competition (Score:5, Informative)

      by alen (225700) on Wednesday January 23, 2013 @02:22PM (#42671781)

      AT&T bought the part that the government said Verizon couldn't buy

      verizon had to sell off a lot of alltel markets and AT&T bought them up

    • Let me guess... this move, by the second-largest US carrier (and largest GSM carrier in the US) is supposed to "improve" competition, just like their last attempt?

      You got suckered by Sprint's explanation that they were only concerned about "competition" and that's why they opposed the T-Mobile buyout by AT&T. The real reason Sprint opposed it is that having a weak T-Mobile around allows them to tell their investors "We're number three! We're number three! Keep believing in our flatlined stock because at least we're still not the smallest player in the market!" Sprint cares nothing about competition. They just feared becoming the weakest and smallest major w

      • by cbhacking (979169)

        Sprint? I'm not even vaguely talking about Sprint. I'm talking about the massive line of bullshit that AT&T fed the FTC, telling them that somehow, buying up what is arguably their only direct competitor would *improve* competition somehow. Sprint, Verizon, and so forth weren't even in my mind. I'm just curious as to whether AT&T thinks they have a better shot at pulling off "no really, this is for the *good* of the GSM users in the USA!" argument this time around... or whether they're even going to

  • To put that price in perspective, its the revenue from a third of a million iphone contracts
    $100 per contract per month * 24 month contract * 325000 = 780e6
    Obviously you're not allowed to put 100% of your revenue toward any specific task, but it provides a bit of perspective.
    Also I'm not sure if $100/month would be considered cheap or expensive for an iphone monthly bill.
    I stopped paying $6 for a virgin mobile dumbfone and upgraded to $19 for a republic wireless android phone some years ago when it was in b

    • by alen (225700)

      iphones are $100 per contract if you're single

      i'm on a 4 line family plan and my first month of the shared plan for 4 smartphones is going to be $200. maybe a little less. 3 iphones and a galaxy s3

    • by dj245 (732906)

      To put that price in perspective, its the revenue from a third of a million iphone contracts

      I prefer to look at it a simpler way-

      $780 million purchase price divided by 585,000 customers is $1333.33 per customer (coincidence??). I am not a business major, but this should be the valuation of both the assets of the company plus their expected future earning potential. You can then make various assumptions about profit $/customer/year. Then you can guess at the value of all the company's assets divided by the number of customers ($ infrastructure/customer). $1333.33/customer seems high to me fo

      • by icebike (68054)

        That's probably a good running start.

        I don't think that 1333/customer is exactly the right calculation though, because AT&T will have these service areas for a long time to come so there are future customers to consider as well.

        If they do a good job (I know its AT&T, but it COULD happen...) they should be able to hold onto those customers (with new phone incentives - see below) and attract new ones. And, you are correct, the spectrum has a lot of value.

        Missed by many is the fact that the cost is no

  • Someone nerdier than me: does the acquisition of spectrum only apply/assist reception for customers in the geographical area that Alltell serves? That is, by buying this spectrum the intention is to improve ATT service in this local area and has no effect nationwide?
    • by dkleinsc (563838)

      I can pretty much guarantee you that this is not about spectrum or improving service. What the bigwigs actually care about when they plan big purchases like this is a larger customer base. Well, that and their personal bonuses.

    • by icebike (68054)

      Someone nerdier than me: does the acquisition of spectrum only apply/assist reception for customers in the geographical area that Alltell serves? That is, by buying this spectrum the intention is to improve ATT service in this local area and has no effect nationwide?

      Not much effect nation wide, other than to provide roaming services to travelers, (theirs as well as others).
      The specifics as to which areas the spectrum licenses cover hasn't been made public. Sometimes these licenses cover a wider area than is currently being exploited.

      So the expectation is that this will just fill a hole in AT&T's coverage map, and/or free them from having to pay roaming fees to their own customers that visit these areas.

  • by Anonymous Coward

    Anyone else look at AT&T (ma-bell) and imagine the phone company as Voltron, reforming into a gigantic beast?

    • by alen (225700)

      happens in ever industry
      in the early 1900's there were dozens of car companies

      cell service is a commodity, its about the same everywhere in the USA. no need for 20 companies like we had in the 90's. i remember those days, they sucked. cell phone service ridiculously expensive back in 2001

    • by icebike (68054)

      Odd you give subtitles for AT&T, but non for Voltron. Not all of us live and die by comic books or animated cartoons.

  • by Anonymous Coward on Wednesday January 23, 2013 @04:41PM (#42673221)
    But not for very much longer.

    I am in a city which already has an Alltel corporate store and an AT&T premier agent. My store is small and I have been struggling ever since the Verizon/Alltel merger went through back in 2009. For a few months I also had a store (which I had invested a lot of money in) in an area destined to become a Verizon market. Foolishly, I was hoping that the 2nd store would be allowed to convert to selling Verizon. Instead, Verizon told me that they did not need distribution in that particular town, and, while I did not have to close, I would not be selling Alltel or Verizon there after a few months. Exactly 6 months after I had moved out, Verizon opened a store there with another independent dealer, in the same town.

    Now this. Not to say I was not expecting it. Alltel has been bleeding customers over the last 3 years, and they have been squeezing out their dealers by reducing their commissions, adding chargebacks to things that did not use to have chargebacks (such as upgrades) and lowballing phones at their corporate stores such that their agents cannot compete on price. (This, on top of saddling them with a massive broken point-of-sale system which was always crashing and becoming unavailable for hours at a time.) I have even been losing my most loyal customers to these tactics. And I can't blame the customers, when they can get phones at the corporate store for $1 when I have to charge $150 or more just to break even, and the chargebacks just make it worse. And, a few years ago, Alltel sent out a helpful memo to their agents, suggesting that we encourage our prepaid minutes customers to sign up for automated replenishments through their online system, when a lot of our daily revenue was coming from people coming into our stores and replenishing with us. Not to mention buying accessories and phones while there. I ignored the memo, but it was still insulting to our intelligence that we would even consider that particular bit of bullshit.

    Ever since this Verizon merger got approved, the remaining Alltel markets have been repeatedly screwed by Verizon, as well. Verizon played games with the towers so that for a while I could not even activate a phone over the air without picking up a Verizon tower (from my store!). When I secret-shopped the local Verizon corporate, I asked the store manager if Alltel coverage in this area was going away. He said yes (that was 2009). The statement was not true, and I can only guess this what he was telling everybody who came in there.

    One way or another, AT&T, Alltel and Verizon all have screwed me in the past few years, and I can only hope that sinkholes open up under their world headquarters.

    (BTW, not that it matters much at this point, did you know the executives in Little Rock can't even get a signal on an Alltel tower, because Arkansas is not one of the 6 remaining states in which Alltel has a market. They probably all use Verizon phones.)

    Aside from the many agents who will get screwed as part of this deal, the customers that I have helped bring to Alltel will be left being screwed by AT&T and their world class fucked-up billing system. But at least they will have more choices in the market for cellphone service (rolls eyes).

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