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Jun. 5, 2009

Effective today, Alltel Wireless has confirmed it is shortening its standard 2-year service contract to just one year. But the company said that handset prices will remain the same.

As could be expected, there’s a little catch... The deal is only available to customers in the 91 cellular market areas that Verizon Communications is required to divest itself!

Some industry observers had predicted that a few weeks ago.

Nevertheless, Alltel will carry on business as usual in the areas which Verizon is divesting, including the areas being acquired by AT&T pending FCC approval.

AT&T also was required to divest some of its Centennial Communications assets as well. As a result, the rival wireless carriers have agreed to an asset swap that was planned in March.

AT&T will pay $2.35 billion in cash for Verizon assets covering 1.5 million subscribers in 18 states, primarily in rural areas. The transaction has not yet been approved by the government but is expected to close in November.

For its part, Verizon was also required to divest 2.1 million wireless subscribers in twenty-two states as well as spectrum and business management assets as a result of regulatory approvals related to its $28.1 billion purchase of Alltel earlier in February.

AT&T will have to convert the Verizon assets from CDMA to GSM technology, however. The undertaking is expected to take about a year and cost AT&T about $400 million.

Verizon will then buy AT&T assets in five markets covering about 120,000 subscribers for $240 million as a result of government approvals related to AT&T’s purchase of Centennial Communications in November 2008.

Verizon is still actively working on the sale of wireless properties in Idaho, Illinois, Ohio, North Carolina, South Carolina and Georgia.

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    This article was featured on Business 5.0 and on Tech Blog.

Source: Alltel Wireless.