Cingular And Att Merging

Cingular and AT&T/Bellsouth Merge

Cingular and AT&T/Bellsouth Merge

Lucretia J. Franklin

University of Phoenix

In the world of business, a new merger arises. The marriage of Cingular and AT&T/BellSouth springs forth with Cingular having 60% and AT&T having 40% (Cauley, 2005). The major reason given for this merger was to create a more effective and efficient provider in the wireless, broadband, video voice, and data markets. This acquisition will streamline the ownership and operations of Cingular Wireless which is jointly owned by AT&T and BellSouth. This will result in AT&T being better able to speed the convergence of new and improved services for consumers and businesses. It will also embrace the industry's shift to Internet Protocol network-based technologies (Cauley, 2005). The agreed price was $41 billion in cash. This merger created the nations largest mobile phone company. Consumer advocates were concerned that this move might hurt competition and impede lower prices. Only time will tell if that concern has any merit.

The deal, when completed, created a cellular giant with forty-six million subscribers and over seventy thousand employees (MSNBC, 2004). The merger became a boon for Atlanta-based Cingular's efforts to cut costs, fill service gaps, and expand its radio frequency in several key US markets. It further provided wireless internet access at broadband speed.

The merger, according to Stan Sigman, President and Chief Executive of Cingular will create customer benefits and growth prospects that each company, without the merger, would not be able to achieve on an individual basis. He also speculated that the merger would mean