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Eric Krapf
Eric Krapf is General Manager and Program Co-Chair for Enterprise Connect, the leading conference/exhibition and online events brand in the...
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Eric Krapf | September 25, 2011 |

 
   

Meanwhile...What's Verizon Up To?

Meanwhile...What's Verizon Up To? Biding their time...counting their money.... And backing AT&T's attempt to buy T-Mobile.

Biding their time...counting their money.... And backing AT&T's attempt to buy T-Mobile.

Fred was puzzled. "Did you see Verizon's CEO came out in favor of the AT&T-T-Mobile deal?" he asked me. "What's up with that?"

We put our heads together and thought like telco CEOs for a couple of painful moments, before concluding that Verizon must want a de facto non-aggression pact with their main wireless rivals, for whatever big deals Verizon may envision in its own future.

Turns out, that may be exactly what Verizon has in mind, according to this blog on TechCaliber Consulting's site by David Rohde, who writes:

"Sometimes CEOs speak more forthrightly to foreign media than they do to their own domestic news outlets. Verizon has an ongoing issue with its U.K. joint venture partner, Vodafone, which holds a 45% stake in Verizon Wireless. That leads to some striking statements by Verizon to the British-based media. The latest one: It's keeping extra money on hand in case it wants to make wireless acquisitions."

Read the whole blog--but the upshot is that Verizon Wireless CEO Lowell McAdams told the Financial Times that the prospect of needing to make an acquisition of spectrum or another firm prevents Verizon Wireless from paying a regular dividend that Vodafone investors want. (The parent Verizon company owns the 55% remainder of VZ Wireless and therefore controls the cellular outlet's ultimate decision-making.)

David suggests that Sprint could be the buyout banquet that VZ hungers for, though he notes that such a huge combination would likely draw the same kind of antitrust challenge that AT&T-T-Mobile now faces. Still, if things get redder in Washington over the next few years, we could be looking at one heck of a duopoly.

Which I think is the real answer to Fred's query: Verizon has a greater interest in protecting its own ability to act than it has in restricting AT&T's. It's kind of like why President Obama never got around to undoing a lot of the unilateral-executive things he criticized his predecessor for--when it came right down to it, he didn't want to limit his own power.

Nobody does. And of course the more power the carriers have, the more limited the enterprise customer's options tend to be. We're seeing it in SIP trunking, as David Rhode's colleague Hank Levine of LB3 Law recently wrote here on No Jitter. And in the wireless world, enterprises already are disadvantaged by the scattershot way that their users consume the service. Just getting to the point where the enterprise can put together a contract for bundled minutes represented a major achievement in mobility management; IT will always be swimming against the tide of users who see their cell phone as a decision they should be able to make for themselves, whatever the consequences.

And however expensive those consequences.





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