Overlapping markets and conflicting decisions on digital technology are two issues the new quartet of Bell Atlantic Corp., Nynex Corp., U S West Inc. and AirTouch Communications has to address. But the potential conflicts are all manageable, said company leaders.
The foursome announced last month they will pool their resources to bid on broadband personal communications services licenses in December, with plans of building a nationwide PCS network.
But first the group has a few obstacles to overcome, especially in four markets where members operate both the A-side and B-side cellular systems.
Such hurdles should be expected when four large players collide, said Bell Atlantic President Larry Babbio.
Alliance members face market conflicts in Phoenix and Tucson, Ariz., and Albuquerque, N.M., where Bell Atlantic Mobile and U S West are the A and B carriers. Also in conflict is the San Diego market, where U S West and AirTouch are the A and B carriers.
Under the alliance agreement, Bell Atlantic Mobile is obligated to resolve the Phoenix, Tucson and Albuquerque conflicts, said Brian Wood, director of corporate communications for BAM. U S West will carry the alliance’s national brand-which is not yet developed or selected-in those three markets.
“We could create a separate corporate structure and another operational relationship for those markets. The last thing we want to do is sell because they are very dynamic,” properties, Wood said. Swapping properties with another carrier might be considered if a good opportunity comes along, he said.
The conflict in San Diego must be resolved by U S West, according to AirTouch.
Digital cellular also could be a problem for the quartet because alliance members are on opposite sides of the technology fence. AirTouch and U S West are backing Code Division Multiple Access technology and both are active in CDMA trials.
But Bell Atlantic already has rolled out Time Division Multiple Access digital cellular technology in four major markets: Washington, D.C., Baltimore, Philadelphia and Pittsburgh.
Nynex has been testing both CDMA and TDMA and was walking the middle line when the company merged its cellular properties with BAM this summer.
The alliance has created a group, temporarily called Telco, that will study and craft the group’s technological commitments, Wood explained. “The decision on technology will be made on what’s most appropriate for the marketplace,” Wood said.
Arun Sarin, senior vice president of AirTouch corporate strategy, said the alliance’s plans call for integrating cellular properties that can be used to bring new PCS technologies to market. However, the cellular properties of Bell Atlantic-Nynex won’t be merged with AirTouch-U S West. They will be managed and owned as separate entities.
“We’ll be the first to bring the new products to market, and we will be able to do more than MobiLink,” Sarin said.
Launched in July 1993, MobiLink is a confederation of wireline cellular carriers wanting to create a brand name and simplified roaming among members. Bell Atlantic joined the program but dropped out five months later.
“We tried it in our Pittsburgh market and didn’t feel it added to the marketing portfolio,” Wood said. “The MobiLink focus was brand and servicing. This alliance goes much further to create products.”
Babbio said the new alliance will be quite different from MobiLink.
“That was a loose market alliance. This will be a tight, national alliance with fewer partners at the table,” Babbio said.
