While it may not be like an AT&T/T-Mobile or Comcast/Time Warner merger, this one surely has a Verizon/Alltel feel to it. That's because this week, Verizon Wireless acquired regional carrier Cincinnati Bell's wireless spectrum for $210 million.
Citing economic challenges in operating a wireless spectrum, Cincinnati Bell dumping off the spectrum to Verizon Wireless gives the second-largest wireless carrier more ability to improve coverage and infrastructure in areas where the company was struggling to maintain a quality network. Greater Cincinnati, Dayton, northern Kentucky and southeastern Indiana are the four key markets who will be affected most by the acquisition, where customers were only getting GSM-based 2G, 3G and HSPA+ speeds across 460 towers.
"We appreciate the loyal support from our Cincinnati Bell Wireless customers over the last sixteen years, and we remain committed to providing them with wireless service and support throughout the transition period," said Ted Torbeck, President and CEO of Cincinnati Bell. Torbeck also mentioned that customers shouldn't worry about taking any action at this time.
For Cincinnati Bell, this deal will finish out the company offering wireless to its customers, which has been a tough market to stay competitive in. CBell had 398,000 wireless customers in 2012 and dropped to 340,000 in December of 2013. When the deal closes some time in the next six months, wireless operations will end for the regional carrier within a year after that.
Until then, Cincinnati Bell will actually lease back several spectrum licenses from Verizon Wireless in order to maintain wireless coverage to its customers before closing up shop on the mobile side. The company will continue to offer TV and broadband, and is currently exploring fiber optic service in the area. "This transaction not only ensures that our customers have access to top-tier wireless service, but it also gives us increased flexibility to meet their growing demand for our Fioptics suite of products," said Torbeck.
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