re: VoiceStream & Cingular GSM-1900 GPRS Network Sharing across 55 Million POPS
* Cingular on Voicestream GSM in NYC (40 MHz)
* Voicestream on Cingular (PacBell) GSM in LA (40 MHz) San Francisco (40 MHz) and 30 MHZ in other California and Nevada markets.
* Extends their networks without the issue passing along roaming costs
>> Cingular Makes Broadway, VoiceStream Mines Golden State
Wireless Today
October 16, 2001
Cingular Wireless wants a footprint in the Big Apple so badly it will allow VoiceStream Wireless to use its GSM network across California and Nevada in order to use VoiceStream's network in New York City.
For Cingular, not having a footprint in New York City is "one of their big problems," Barney Dewey, an analyst with the Andrew Seybold Group, told Wireless Today.
So much of a problem, Dewey added, that Cingular is giving more than it's getting in the agreement with VoiceStream, a unit of Deutsche Telekom's [DT] T-Mobile International Group. "I see this turning out to be a VoiceStream advantage," he said. "VoiceStream is a GSM carrier and VoiceStream gets into California and Nevada on a GSM network with pretty good average."
Cingular, however, gets into New York City without having a GSM footprint in the surrounding markets. The Atlanta-based carrier operates TDMA systems outside New York City. Its customers in those markets, as well as from the rest of its TDMA footprint - which makes up more than 80 percent of its total footprint - won't be able to roam onto its GSM network in the Big Apple.
Nonetheless, there are advantages for both carriers. "This kind of arrangement allows Cingular and VoiceStream to have the reach without the cost," said Jeff Kagan, an independent wireless market analyst based in Atlanta. "It effectively extends their network without the issue of eating, or passing along, the higher roaming costs. It makes a heck of a lot of sense from a competitive perspective."
Other carriers, though, aren't likely to follow suit. "Cingular and VoiceStream are the only large operators that don't have coverage in some of the top 25 markets," Dewey said. "I'm not sure that we would see this repeated."
Atlanta-based Cingular, the U.S. wireless venture of BellSouth [BLS] and SBC Communications [SBC] and Bellevue, Wash.-based VoiceStream created a 50/50 venture to manage all of the spectrum both companies own in California, Nevada and New York City. The carriers will purchase airtime from the venture as they need it in each of the markets.
"It will act as wholesaler selling networks services to the companies," Cingular President and CEO Steven Carter said in a conference call with news media and industry and financial analysts.
With market licenses both companies acquired through affiliates in the Federal Communications Commission's re-auction of bankrupt NextWave Telelecom's licenses tangled up in a legal battle, neither company saw much hope for other deals to add spectrum.
"Both companies were looking for a quicker way to enter new markets," VoiceStream CEO John Stanton said. "Spectrum is still scarce in the United States, and this agreement does not change our view that additional spectrum needs to be allocated."
The carriers will have 40 Mhz of spectrum in the 1900 Mhz bands to use in Los Angeles, New York and San Francisco, and 30 Mhz of spectrum in the other California markets and across Nevada. Those two states and New York City include 55 million POPs.
Carter said regulatory approval is not needed for the venture because the companies aren't exchanging market licenses. Cingular will continue to operate with its licenses in California and Nevada, and VoiceStream will continue to operate in New York. <<
- Eric - |
