Cingular Vs Verizon, The Gloves Come Off


Its been all quiet on the mobile front. After a flury of mega-billion dollar mergers – Cingular gulping AT&T Wireless, Sprint swallowing Nextel and Alltel taking over Western Wireless – the industry went into a self imposed digestive phase. The prices stabalized, and a general peace broke out amongst various parties. The customer churn stabalized as well. But all that will be history soon, and expect a new round of hostilities. Though you cannot rule-out price wars, this time around network reliance and quality of calls.

This will come at a time when the wireless penetration in the US has grown to over 185 million subscribers. The big three will have a tough time luring people with lower prices – those who cannot afford to pay monthly bills, i.e. children of the lesser (economic) god, are opting for pre-paid plans. At the high end of the spectrum, you have MVNOs like SK-Earthlink getting ready to rumble. The big three will be forced to look for growth the old fashioned way – by stealing from rivals.

“Can You Hear Me Now” message is helping Verizon gain a lot of customers, and with EVDO around the corner, things could get pretty close between Verizon and Cingular. Second quarter was a good indication. As a recap, in the most recent quarter, Cingular added 1.1 million, Verizon 1.9 million and Sprint about 400,000 new subscribers.

Evidence of forthcoming tussle between the giants can be seen in two rather unrelated, yet intimately intertwined news announcements, both involving Cingular Wireless, which desperately wants to put distance between itself and Verizon Wireless. Atlanta-based Cingular has 51.6 million subscribers, and can feel the hot breath of Verizon, with 47.37 million subscribers on its neck. Sprint+Nextel have about 44 million subscribers in total.

First, RadioShack decided to end the multi-year arrangement with Verizon in favor of promoting Cingular. This means, Verizon will experience about 100,000 to 125,000 fewer customer additions per quarter, according to Albert Lin, analyst with American Technology Research. “Cingular seems far more interested in keeping gross additions high and market share in the #1 spot,” Lin writes in a note to his clients today, “Thus, adding a major retailer like RSH is probably going to helpful in achieving that goal.”

At the sametime, the company announced the first phase of its $6 billion network upgrade, which is focusing on improving coverage and network quality. I think this will be the only way to counter the Verizon – ‘our voice is better’ marketing strategy. Cingular now has the spectrum to reallyfill out its network, and perhaps with competition, a reason to spend some serious dollars.

Looks like things are going to be fun again in the wireless business.



cingular- BEST verizon Worst verizon is a complete rip-off when they say that there are new ringtones of songs verizon never has it! and with verizon, everythings extra! ringtones with the actual song with the person(s) singing it- extra, or not even having it, phones-EXTRA!, actualy living- EXTRA! and cingular gets everything unlike retarded verizon! get cingular!

Jesse Kopelman

I’d be more interested in hearing when Cingular will do something to make its “All Over” network more than hype. Right now, if you are Cingular customer (unless you came over from AWS) in New England there are over 1,000 AT&T WIreless towers that you are getting no benefit from whatsoever. In other markets, the situation is reversed. Nationwide, there are probably about 10,000 base stations that need to be replaced to make the claim of “Cingular and AT&T WIreless have joined forces” a reality.

Jesse Kopelman

Glen, you are forgeting that Darth Vader (James Earl Jones) is Verizon’s mascot. Then again, the AT&T logo was know as the deathstar and now that SBC owns the brand they could give the logo to Cingular . . .


The story sounds like the beginning of a Star Wars movie. You left the part out where Cingular adopted Darth Vader as its mascot.


These companies may think they can keep making money by raiding/re-raiding the customers of their competition, but at some point, they need to start focusing on the bleeding off of their own customers. The real winners will be the ones who can offer decent customer service, good quality and fair prices. That’s something that none of them offer on a consistant basis.

John Thacker

ALLTEL and Western Wireless both used all CDMA networks and had nearly no overlap between their coverage areas.

Verizon and ALLTEL both seem to be enjoying their current roaming deal, so I’m not sure that a merger would be pending. There are mergers that would make sense: for example, ALLTEL and US Cellular both have CDMA networks and their coverage would fit together quite nicely– US Cellular’s coverage is in the Pacific Northwest, Midwest, and New England, ALLTEL was primarily in the Southeast, some of the upper Midwest, and some Plains states, and Western Wireless was in the Central and Mountain time zone states.

John Thacker

Don’t be surprised if AllTel/Ww makes move for T-Mobile USA some time in the future.

Gosh, I’d be surprised.
T-Mobile USA – All GSM network
AllTel/WW – CDMA.

Consider also that AllTel and Verizon have been relying on each other with a very nice plan to roam on each other’s networks at minimal cost. It gives AllTel the ability to offer nationwide roaming like the national carriers (and is something it still needs even with Western Wireless) and Verizon service in all the rural markets (giving a legup on Sprint that way).

Charlie Sierra

Andy probably has no idea just how right he is.

In FACT at this very moment T-Mobile USA is the 3rd largest carrier in terms of direct subscribers.

Telecom has two massive problems, systemic overcapitalization and morons for mgt, thus the only means to survive is via Washington DC. Which in effect constitutes a private tax.

Orwell’s 1984 was dead on, but today we have to face its manifestation in the form of the “Private Totalitarians”. (think hollywood and telecom, and inevitable catfight between them)

Andy Abramson


The last time Cingular went into a sales push (post merger with PacBell Cellular) the drop off in service quality related to capacity issues was unbearable.

My guess is the same think will happen.

T-Mobile is the dark horse here. Don’t be surprised if AllTel/Ww makes move for T-Mobile USA some time in the future.

Comments are closed.