Vodafone, Verizon: Still Friends


A lot has been made about the possible rift between the two wireless giants and their partnership is said to be on the rocks. But that just might be more media and Wall Street speculation than anything real. I am pretty sure, it was a good idea for the two companies to get together, and decide to bid up the price of AT&T Wireless. Cingular ended up paying $11 billion more for the same assets. The difference between Vodafone and Cingular was only 5 percent, and I think Vodafone refraining from raising it further was part of a calculated plan.

Many forget that Arun Sarin, the current Vodafone CEO worked at Airtouch, which was bought by Vodafone and then merged with Verizon Wireless. He is pretty tight with the New Jersey crew. Some media reports have indicated that Sarin had the green-light from his partners at Verizon.

“I’m very hopeful we’ll get a win-win situation in the next 12 months. Eighteen months, three years from now, we’re going to be a good partner with Verizon Wireless,” Vodafone Chief Executive Arun Sarin told reporters Tuesday at a telecommunications conference in Cannes, France, reports Bloomberg. There is even more anecdotal evidence that the two companies might be getting cozier. Verizon is said to be looking at offering a GSM-CDMA combo handset. It will be one way to keep the Vodafone customers on the Verizon network. This is a sign, the two want to work together, not divorce each other. And as for Vodafone having to take a backseat, well for $600 million a year in dividends, that is not such a bad thing. Its sort of like Alex Rodriguez playing at third base. And this whole rift between the two companies is much like that fight between Derek Jeter and A-Rod.

Comments are closed.