January 14, 2003
If you were thinking of switching from Cingular to AT&T Wireless, or vice versa, you might want to wait a week or two. The companies are holding merger talks, The Wall Street Journal reported.
Cingular is the nation's second-largest cell phone carrier and AT&T Wireless is the third. A combination of the two would theoretically provide a more powerful challenge to Verizon Wireless, the largest.
It's not the first time the companies have rubbed noses. They held a round of talks about a year ago, so each already has most of the background information needed to come to an agreement quickly.
Cingular is reportedly considering an initial public offering, which would presumably provide the capital needed to complete the AT&T Wireless acquisition. SBC owns 60 percent of Cingular, while BellSouth owns the rest.
AT&T is an attractive acquisition target. It has the largest number of business customers of any cell phone company though its growth has been weak lately and it has lost market share over the past year.
T-Mobile, owned by Deutsche Telekom AG, might also emerge as a bidder for AT&T.
Phone companies have come to rely on their cell phone units for growth, as landline business weakens. New wireless data technology may provide the next big growth spurt. Verizon Wireless recently announced plans for a new wireless network that delivers speeds comparable to DSL lines.
