Will Verizon really gobble up Alltel and become the nation’s largest mobile phone provider? The Wall Street Journal reported a possible merger two years ago, but that obviously never happened. We know T-Mobile and Cingular run on the GSM network so that rules them out and Sprint is busy fussing with the integration of Nextel’s network. That leaves Verizon as the only viable candidate, but Alltel’s reported price tag of $30 billion might sway Verizon from going for the whole enchilada.
Albert Lin, an equities analyst with American Technology Research, says there is a good chance this will happen because they both use the CDMA network and it will allow Verizon to become the largest provider in the country. Michael Nelson, an equities research analyst at the Stanford Group, thinks otherwise.
“Verizon is simply not a willing buyer,” he said. “And Sprint is in no position to be making a move of this size right now, so it’s really up to private equity.”
With the impending FCC auction of the 700MHz spectrum this year, Nelson says:
“They can build their own network for a lot less than $30 billion.”
I’m not much of a betting man, but I don’t see this happening. It didn’t happen two years ago, so what makes it different now?