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AT&T may snap up ex-Verizon wireless space

updated 02:00 pm EST, Wed February 4, 2009

ATT May Get Verizon Assets

AT&T may end up acquiring some of the resources Verizon has to auction off to complete its buyout of Alltel, sources tell the Wall Street Journal. The iPhone-carrying provider is reportedly one of the stronger bidders for the estimated $3 billion in cellular coverage, spectrum and other assets that the US government has determined should be sold to competitors to maintain a level playing field. AT&T could gain as many as 2.1 million new subscribers if it purchased all the assets.

The telecoms firm isn't the only one involved and faces competition from an unnamed cable company as well as private equity organizations like the Carlyle Group, Kolberg Kravis & Roberts and Providence Equity Partners, but is the best-positioned company of the group to make a bid, the insiders claim.

A takeover of the resources would help AT&T close the gap in subscriber numbers between itself and Verizon, the latter of which will be the single largest carrier in the US thanks to the Alltel move, and would give AT&T better coverage in rural areas where CDMA providers often thrive.

Public advocacy groups, however, object to the possibility of AT&T acquiring most or all of the auctionable resources, as they see it further reinforcing market conditions that give AT&T and Verizon about 60 percent of the entire US cellular market. Rural residents and small regional carriers have also expressed concern that AT&T may abuse any gains to raise roaming rates for rivals using GSM phones on those parts of its network.

by MacNN Staff



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