AT&T Picks Up Verizon’s Scraps, Acquires Alltel for US Expansion

AT&T has announced that it has agreed to acquire Alltel, Atlantic Tele-Network, Inc.’s US retail wireless operations for $780 million.  The deal entitles AT&T to Alltel’s licenses, network assets, retail stores and approximately 585,000 subscribers, as well as spectrum that is expected to boost the network’s services.

Alltel covers 4.6 million US subscribers in rural areas of Georgia, Idaho, Illinois, North Carolina, Ohio and South Carolina.  The bulk of the company’s assets were acquired by Verizon four years ago, and what is left is now being sold to AT&T.

The deal is expected to close in the second half of 2013, but it still needs to be approved by the Federal Communications Commission and the Department of Justice.

AT&T is expanding not only in the US but in other countries as well, eyeing acquisitions in Europe.  Formidable candidates include Royal KPN NV, the biggest telecom company in the Netherlands, and Everything Everywhere, one of the biggest wireless carriers in the U.K..  The European expansion is said to be triggered by its slow growth in the US.

AT&T’s efforts in the US seem miniscule compared to Verizon, which managed to snag 122 advanced wireless services licenses from Comcast, Time Warner Cable and Bright House Networks.  Aside from the licenses, “the cable companies can sell Verizon plans on a wholesale basis, and they’ve formed a joint venture with the latter to develop “technology to better integrate wireline and wireless products and services.”

It also doesn’t help that AT&T is also being rather stingy with its network, refusing to allow all of its subscribers to use FaceTime via cellular on their network.  AT&T started by refusing to offer it as whole, which led to offering the feature to deaf and hearing impaired subscribers.  AT&T eventually caved, extending FaceTime via cellular to its subscribers except for those with grandfathered unlimited data plans.  Advocates continue to hound the company, stating that AT&T is in violation of net neutrality until the company offers the services to all of its subscribers.

Acquisition has always been the name of the game for AT&T, and if approved, Alltel could help boost the company’s efforts in expanding in the US as well as improving its services.