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January 2, 2007
The assimilation of BellSouth into AT&T heralds a new wireless era that will see the latter attempt to capitalise on its newly acquired wireless heritage and make advertising a key revenue stream.
In a report for the Wall Street Journal, AT&T said its control of Cingular – part of the $86bn BellSouth acquisition – was key to creating a company “with wireless at its heart”.
Now that BellSouth deal is complete, AT&T intends to market mobile service under its own brand name.
“The biggest asset we bought here was Cingular,” AT&T chairman and chief executive Edward Whitacre said in the Journal. He said AT&T will start selling wireless service under its own brand name to its pool of corporate phone and Internet customers.
Owning Cingular allows AT&T to offer discounts on bundles that were impossible prior to the purchase BellSouth deal.According to the Journal AT&T has been testing dual-mode devices that can run over wifi thus providing significant savings for consumers at home.
The firm also revealed that it intends to target users with advertising on their mobiles.Advertisers will be able to buy spots for TV and broadband beginning early this year, with wireless ads following later this year, the Journal said. The advertising business could generate several billion dollars in revenue per year in the next five years, the paper quoted the company as saying.
The Federal Communications Commission (FCC) approved the $86bn merger of AT&T and BellSouth last Friday (Dec. 29). The completion came only after Democratic Commissioners Michael Copps and Jonathan Adelstein received assurances from AT&T that the combined company would assure net neutrality in packet prioritisation and bring around 3,000 jobs back to the United States which BellSouth had sent offshore.
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