Cingular Wireless on Tuesday said it completed its $41 billion acquisition of AT&T Wireless after receiving regulatory approvals from the FCC and the U.S. Department of Justice.
Cingular Wireless, a joint venture between BellSouth Corp. and SBC Communications Inc., now has about 46 million customers, surpassing Verizon Wireless as the No. 1 U.S. mobile operator.
The acquisition brings to Cingular service in new areas, including Denver, Phoenix, Minneapolis and Pittsburgh, and positions the company to offer advanced third-generation, or 3G, wireless services, Stanley Sigman, president and CEO of Cingular, told reporters today on a national conference call. AT&T Wireless, of Redmond, Wash., already is offering 3G services in five markets, Sigman said, and Cingular is aiming to deploy the technology beginning in the fourth quarter of 2005.
Atlanta-based Cingular has strength in the consumer market, Sigman said, and AT&T Wireless is stronger in the business and enterprise market.
The combined company has about 68,000 employees. Sigman said Cingular will not announce any workforce reductions until after the first of the year, adding the number of job cuts has not been determined.
Cingular announced closing the acquisition after the FCC and Justice Department granted approval with some conditions. Sigman said Cingular must divest assets in 16 markets, which will affect less than 350,000 customers.
All five FCC commissioners approved the acquisition, but the two Democrats, Jonathan Adelstein and Michael Copps, partially dissented. They cited concerns with how the combined company would affect competition in the wireline market. BellSouth, SBC and Verizon Communications Inc., the three biggest local phone companies, also own the two largest wireless carriers, representing more than half of all wireless subscribers, Copps said.
“In many markets BOC control of wireless customers will be even higher,” he said. “Can we expect that Bell-owned wireless carriers will compete tooth-and-nail against their wireline parents? I don’t think so.”
FCC Chairman Michael Powell said issues relating to the combination of wireless and wireline companies “was and will remain a matter of focus and concern. However, at the end of the day, we did not believe that the evidence in the record was sufficient to justify and substantiate additional conditions beyond those already imposed by the order.”
