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[Standards and Usage] [Companies] [European Acquisitions]
Although US society is very mobile, with people regularly travelling long distances, it nether-the-less has developed very fragmented and expensive mobile networks with frequent gaps in coverage. In fact half the mobiles in the US still work on the analogue system. Each region has created its own mobile companies, using different standards and users often switch off their mobile phones because they must pay to receive calls as well as to make them. As a consequence, pagers are widely used to receive notice of calls. Also in the US, the early break-up of Bell brought competition which resulted in fixed lines systems that were more reliable, cheaper and readily accessible through numerous public pay phones. This meant less need for mobiles. In Europe it is the opposite situation.
The US digital mobile network is mostly based on the Code Division Multiple Access (CDMA) standard developed by Qualcomm. Thus, European GSM phones will not work in the US. In respect of the next generation of high capacity networks, the Universal Mobile Telecommunications Service (UMTS), the US proposed an enhance form of CDMA but Europe proposing an alternative standard. In the end differences were resolved when Ericsson acquired QualComm.
[AT&T] [Bell Atlantic] [Vodafone AirTouch] [MCI WorldCom]
AT&T has strong alliance with the UK's BT through their fixed network venture called Concert. They aim to step up investments in Europe.
In December 1999, AT&T confirmed it would sell a large part of its mobile operation to the public - a move estimated to raise $10bn, becoming the biggest IOP in US corporate history. Called AT&T Wireless Group, the business will include voice and data, and European as well US operations. The money will be used for new acquisitions. AT&T's wireless business is expected to generate $7.6bn of revenue in 1999. Cash flow is strong.
Bell Atlantic holds mobile licenses in 24 eastern states of the US. In September 1999 it re-opened discussions with Vodafone AirTouch about merging their US operations. A merger would bring nationwide coverage to both parties. Vodafone is to present the merger to its shareholders on 24 January 2000. Previous to this, Bell Atlantic had a joint venture with AirTouch called PrimeCo but dissolved it after Vodafone acquired AirTouch - Bell Atlantic had made a rival bid for AirTouch. Meanwhile, Bell Atlantic is on schedule to complete its merger with GTE's wireless operations.
Vodafone took over AirTouch in mid 1999 for £37bn to then make the world's largest mobile telecommunications company. AirTouch held mobile licenses in 25 western states of the US. The deal is expect to conservatively save £200m a year from efficiencies but the biggest attraction is the ability to keep customer revenues when they travel, as well as offer corporate customers centralised billing and advanced services wherever they go. It will also make it easier to deal with world wide manufacturers of mobile equipment including, for example, car manufacturers who will increasingly add in-car communications equipment.
Other US interests included PrimeCo (50% with Bell Atlantic which was dissolved after the AirTouch takeover) and in Cellular One. AirTouch also had interests in India, Japan, South Korea, Egypt, Belgium, Germany, Italy, Poland, Portugal, Romania, Spain and Sweden.
In September 1999 Vodafone AirTouch re-opened discussions with Bell Atlantic about merging their US operations. A merger would quickly bring nationwide coverage to both parties, much cheaper than trying to build a network from scratch or buy numerous smaller operators.
Acquired Sprint in October 1999.
US telecom companies have made some of the world's largest telecoms acquisition, especially of European companies. |
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