Roaming issues probably tops the list of concerns of Verizon Wireless’s planned purchase of Alltel Communications L.L.C. The nation’s four largest operators as well as a number of small carriers relied on Alltel and had established partnerships for roaming across what the carrier proclaimed was the largest geographical network in the country.
Now that Verizon Wireless is in control of those areas, the big question is whether Verizon Wireless will sell off some of that spectrum or if Verizon Wireless’ competitors will have to pay more.
Verizon Wireless is already rattling the wheels of AT&T Mobility by surpassing the carrier as the largest provider in the nation, but because Alltel acquired an established GSM roaming network when it acquired Western Wireless Corp. specifically to serve the needs of AT&T Mobility and T-Mobile USA Inc., those carrier now may have to pay substantial roaming chargers to Verizon Wireless.
Alltel noted in a recent Securities and Exchange Commission filing that it’s currently operating under a reciprocal roaming agreement with Verizon Wireless that is set to expire in 2010; and that it signed a 10-year roaming agreement in 2006 with Sprint Nextel Corp. and extended its GSM roaming agreement with AT&T Mobility through 2012.
Ken Hyres, senior analyst at Technology Business Research Inc., foresees Verizon Wireless being forced to sell spectrum in those overlapping areas.
“What it’s going to come down to is where exactly those markets are as to who will purchase them,” Hyres said.
Hyres said he sees AT&T Mobility as a viable candidate, but believes purchasing certain secondary markets would be a smarter move for T-Mobile USA in its continuing efforts to increase its network reach.
Hyres said a big reason for this purchase is a trend lately for carriers to gain savings through reducing roaming costs and obviously now, Verizon Wireless will rarely rely on other carriers for roaming.
Keith Mallinson, founder of Wise Harbor, agrees Verizon Wireless will be putting some spectrum up for sale in order to make sure everything remains on the up and up in the world of roaming.
“When [a carrier] is dominant in a certain region it becomes the monopoly of wholesale supply for roaming and it might be deemed that they could abuse that position,” Mallinson said.
Alltel noted in a recent Securities and Exchange Commission filing that it’s currently operating under a reciprocal roaming agreement with Verizon Wireless that is set to expire in 2010; that is signed a 10-year roaming agreement in 2006 with Sprint Nextel Corp. and extended its GSM roaming agreement with AT&T Mobility through 2012.
