Wednesday, December 15, 2004

A marriage made for Monopoly

Sprint-Nextel

Verizon Wireless, Cingular, and now, Sprint Nextel, share 75% of the cellular phone marketplace. With its merger announced today, the new company, Sprint Nextel, will serve more than 40 million wireless subscribers. Before super cellular service packages are offered to those 40 million folks, Sprint Nextel will need to focus on making Sprint's CDMA 1.9 GHz network interoperable with Nextel's 800 MHz and drafting up site-sharing arrangements. This may lead to existing customers updating their current wireless phones and, with services merging, may hold many frustrating times ahead. However, if you speak to any executive regarding the merger you will hear the standard “there will be kinks to work out, but in the long run the customer will be the benefactor; with increased coverage, better cell to cell options, etc.” If this is really the case, of large mergers benefiting us, the consumer, I have a question: Why have cable rates (one cable company per area, city or rural, is usually the case.) increased at three times the rate of inflation? "This new powerhouse company has the spectrum, the infrastructure, the distribution and the superb and differentiated product portfolio that will drive our continued success." Timothy Donahue, Nextel president and CEO.
Benefit?

With the FCC eventually regulating of the power lines that deliver broadband and internet service the FCC chairman, Michael Powell says, “The development of multiple broadband capable platforms--be it power lines, Wi-Fi, satellite, laser or licensed wireless--will transform the competitive broadband landscape and reap dramatic windfalls for American consumers and the economy,"

Will we have more options to choose from but fewer companies to provide these options?

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