Verizon seeks assurance from wireless partner - from FT
By Richard Waters in New York and Dan Roberts in London
Published: March 29 2001 23:41GMT | Last Updated: March 29 2001 23:58GMT
Verizon on Thursday sought assurances from Vodafone
over the future of their US wireless partnership after
reports of a rift between the two.
Ivan Seidenberg, president and co-chief executive of the
US telecoms company, called senior Vodafone
executives to try to clear the air over Verizon Wireless, a
venture in which Vodafone owns 45 per cent.
The call was prompted by reports that the two had fallen out over Verizon Wireless'
technology plans and the possibility that Vodafone would seek to take control of
the wireless company, the largest mobile carrier in the US.
Later, the two companies issued a joint statement calling the reports "mere
speculation".
Mr Seidenberg made clear that the US company had no intention of giving up
control of the mobile carrier. "Wireless is a foundation of Verizon
Communications' long-term strategy and brand development," he was quoted in
the statement as saying.
Vodafone gave up control of the US operation after agreeing to merge AirTouch, its
own US business, with that of Verizon Wireless, creating what some analysts see
as an uneasy relationship between former adversaries. A Verizon forerunner, Bell
Atlantic, had lost out in the bidding for AirTouch a year before.
"There may be some people [at Vodafone] who would love to control [Verizon
Wireless]," said one person close to the US company. "But so what? That isn't
what happened."
Under their partnership agreement, Vodafone cannot gain control of the wireless
venture without Verizon's consent, this person added.
On Thursday, Vodafone denied it had briefed journalists about plans for a bid and
said there was "not much truth" in reports it was preparing the groundwork.
The two companies tried to play down the suggestion that Verizon Wireless' plans
for third-generation mobile technology, announced last week, had driven a wedge
between them.
Verizon Wireless said that it would adopt CDMA2000, which is incompatible with
the 3G technology being planned by Vodafone. The US company later partially
backed down and said it had yet to decide definitively which technology to adopt.
However, in a comment that appeared to point to the UK company's influence in
the technology decision, Chris Gent, Vodafone chief executive, said: "The choice of
any future technology will be made in the interest of both parties and with full
awareness of the evolving technology trends in our industry."
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