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Verizon`s busy McAdam chats about AT&T, 4G and rural America


21/09/2011

Verizon CEO Lowell McAdam is apparently not one to wait for the coffee to kick in.

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Yesterday morning he had breakfast with Federal Communications Commission Chairman Julius Genachowski and then headed over to the Goldman Sachs Communacopia XX Conference, where he sat down for a chat before the clock had struck 9.

As Sprint CEO Dan Hesse would later in the day (CP: Sprint CEO Hesse chats `fireside` about what Sprint does and doesn`t have), McAdam offered his thoughts on AT&T`s proposed purchase of T-Mobile, which the Justice Department and seven states are now trying to block. Like plenty of cynics, McAdam (seeming far from a cynic himself) said he viewed the deal as inevitable.

"I have taken a position that the AT&T merger with T-Mobile was kind of like gravity," McAdam told Goldman`s Jason Armstrong. "It had to occur because you had a company with T-Mobile that had the spectrum, but didn`t have the capital to build it out. AT&T needed the spectrum — they didn`t have it — in order to take care of their customers. And so that match had to occur."

Should the FCC and the "folks on the Hill" succeed in stopping the deal, he added, they`ll still need to offer the public a spectrum-growing alternative.

"There are a number of ways that we can do that — through secondary auctions, through the incentive auctions, through freeing up additional spectrum. But if you look at the path that wireless is on, clearly, we need to have more spectrum in the marketplace," said McAdam, "and I think the FCC has got to be very focused on delivering that."

Again later in the day, Hesse would be unexpectedly docile on the topic of the T-Mobile sale, describing Sprint as being not on a moral high ground but having the luck to find itself positioned on the same side of the argument as consumers.

McAdam, too, was gentle on this front, painting AT&T CEO Randall Stephenson as a guy trying to do the right thing, and describing himself as waiting for things to pan out before coming out with a position.

"Randall Stephenson is very aware of the health of the industry, and he is going to balance that, and I need to see where they come out before we jump ... it`s only when you get down to the specific tactics that you really understand what the impact might be," he added. "So I think it`s important for us to be thoughtful about this and see what happens."

Before AT&T switched the marketing focus of its T-Mobile purchase to jobs creation (CP: AT&T, T-Mobile job creation claims debunked, to Sprint`s delight) it had described bringing 4G to rural areas of America as a central benefit of the deal. McAdam, later in his conversation with Armstrong, also discussed the 4G situation as it relates to rural America and regional carriers.

In addition to Verizon`s aggressive plan to rollout 4G to major cities, he said:

... We have gone out proactively to the rural carriers and said, `Look, rather than us come in in three years and build out over you, why don`t you ... use our spectrum, and you build out LTE on C block. You`ll get it out there that much faster and then we`ll do a roaming arrangement so that you get nationwide access.`

We`ve got 11 carriers signed up for that already. We`ve got at least double that amount in the pipeline. It is a significant amount of geography that will be covered, and we think that is the way to get that service out there. We win without having to put our capital in those markets, at least initially.

McAdam may be waiting to form his own opinions, but Verizon`s LTE roadmap seems to suggest rural America will find its way to highspeed wireless, whichever way the vote swings for AT&T.



 

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