AT&T Mobility (NYSE:T) plans to replace Element Mobile's CDMA in service in Wisconsin with HSPA service carrying the AT&T brand, the carrier confirmed to FierceWireless.
AT&T said in a statement that it has reached an agreement with "the existing partners in Element Mobile" to form a new company "that will be majority owned by AT&T that will sell services under the AT&T brand to customers in Central Wisconsin." The carrier declined to provide details on the transaction, including the financial specifics.
According to documents filed with the FCC, the new company will be called Lake Mobility and AT&T will own 59.9 percent of it. Lake Mobility currently operates a CDMA network and AT&T said it will "overbuild an HSPA+ network on the CDMA network. Lake Mobility will continue operating the CDMA network for at least one year after this transaction closes in order to complete the HSPA+ overbuild. Thus, while the network is being overbuilt and converted, no CDMA subscribers will lose service."
In the FCC filing, AT&T said that it will work to transition the CDMA subscribers to AT&T handsets and rate plans. "AT&T will offer each postpaid subscriber a HSPA+ handset comparable to their existing CDMA handset without requiring a contract extension," AT&T said. "For postpaid CDMA subscribers with term contracts (other than month-to-month contracts), AT&T plans to honor the majority of such subscribers' contracts for the life of those contracts by providing them with substantially similar AT&T service plans. Subscribers on rate plans that are substantially similar to existing rate plans will be able to remain on those plans for the duration of their existing contracts. Subscribers for whom substantially similar rate plans cannot be created will be able to choose a different rate plan offered by AT&T or they will be able to terminate service with no early termination fee."
The transaction still requires approval by the FCC.
AT&T's move into Wisconsin is the carrier's latest effort to broaden and deepen its wireless coverage. For example, AT&T recently consummated its purchase of 39 lower 700 MHz B Block spectrum licenses from rival Verizon Wireless. AT&T plans to deploy its LTE network across the licenses. AT&T is also purchasing spectrum from the likes of Long Lines, NextWave Wireless, McBride Spectrum Partners, Farmers Telephone Company, Tellular and David L. Miller in separate transactions.
Further, this isn't the first time AT&T has announced plans to replace a CDMA network with a GSM-based one. In January AT&T announced it would acquire Atlantic Tele-Network's retail wireless business, which operated under the Alltel brand, for $780 million. As part of the transaction, AT&T said it would replace ATN's CDMA network with a GSM-based one. The FCC has stopped its review of that transaction, arguing that AT&T has not provided enough information about how it will transition Alltel's remaining prepaid customers to its network.
- see this FCC filing (PDF)
AT&T, Verizon close $1.9B 700 MHz B Block spectrum deal
AT&T 'extremely disappointed' with FCC's delay in Alltel purchase review
AT&T to snap up Iowa's Long Lines as wireless acquisitions continue
AT&T to acquire NextWave--and its WCS spectrum--for $600M
AT&T to acquire Alltel's spectrum, remaining customers for $780M