Magazine

Table: A Stampede of Providers


Once the bright spot of the telecom industry, the wireless sector is now in trouble. Growth is slowing, prices are plummeting, and losses are mounting. Here's a look at the six national players that are slugging it out.

DENNIS STRIGL, PRESIDENT AND CEO

PROVIDER: VERIZON WIRELESS

SUBSCRIBERS: 29.4 million

REVENUES: $17.4 billion

NET INCOME/LOSS: $2.3 billion*

PROSPECTS: The joint venture between Verizon and Vodafone is the industry heavyweight. Still, it has challenges. Its initial public offering has been stalled by investors who have soured on wireless stocks.

MERGER POSSIBILITIES: Verizon execs say they aren't interested in acquisitions anytime soon. Long term, the company could go after Sprint PCS or Alltel.

STEPHEN CARTER, PRESIDENT AND CEO

PROVIDER: CINGULAR WIRELESS

SUBSCRIBERS: 21.6 million

REVENUES: $14.3 billion

NET INCOME/LOSS: $2.5 billion*

PROSPECTS: Formed by BellSouth and SBC, Cingular has scale and profitability. It also has a patchwork of different wireless technologies. Cingular is investing heavily to standardize on one.

MERGER POSSIBILITIES: Cingular could go on the prowl for acquisitions later this year or next, with AT&T Wireless and VoiceStream the most likely targets.

JOHN D. ZEGLIS, CEO

PROVIDER: AT&T WIRELESS

SUBSCRIBERS: 18 million

REVENUES: $13.6 billion

NET INCOME/LOSS: $887 million

PROSPECTS: It has a top brand name and $5 billion in cash. It's also getting bigger, with the $3 billion acquisition of TeleCorp. Even so, it may not have the size to take on Verizon and Cingular.

MERGER POSSIBILITIES: Look for AT&T Wireless to either make another acquisition, probably VoiceStream, or sell out, most likely to Cingular.

CHARLES LEVINE, PRESIDENT

PROVIDER: SPRINT PCS

SUBSCRIBERS: 13.6 million

REVENUES: $9.7 billion

NET INCOME/LOSS: $1.3 billion

PROSPECTS: Last year, it had the fastest growth, adding 4 million subscribers. But it's losing money and has debt of $15 billion. Spooked investors have driven the stock down 59% this year.

MERGER POSSIBILITIES: It looks like takeover bait. Most likely acquirer is Verizon Wireless because it uses the same technology. But a deal won't happen anytime soon.

TIM DONOHUE, PRESIDENT AND CEO

PROVIDER: NEXTEL COMMUNICATIONS

SUBSCRIBERS: 8.7 million

REVENUES: $7.0 billion

NET INCOME/LOSS: $612 million

PROSPECTS: Nextel is Corporate America's provider. Some 91% of its customers are businesses, insulating Nextel from price wars. It boasts the most revenue per customer: $69 a month.

MERGER POSSIBILITIES: Nextel's huge debt load of $14 billion--and having technology incompatible with every other carrier's--make it unappealing.

JOHN STANTON, CEO

PROVIDER: VOICESTREAM WIRELESS

SUBSCRIBERS: 7 million

REVENUES: $4 billion

NET INCOME/LOSS: $3 billion

PROSPECTS: VoiceStream offers the lowest rates of all, which helped drive down industrywide prices some 26% in 2000, to 14 cents a minute. Deutsche Telekom acquired the company last year.

MERGER POSSIBILITIES: If VoiceStream is put on the block, Cingular and AT&T Wireless may be interested. But the company would fetch only one-third the $30 billion DT paid for it.


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