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Vodafone Close to Selling Stake in Verizon Wireless
45% Share Could Net Company $135 Billion
by Karl Bode Monday 25-Mar-2013 tags: business · wireless · wireless
Reports continue to emerge that suggest Vodafone is getting very close to selling its 45% ownership stake in Verizon Wireless. A report earlier this month claimed that talks between the two companies concerning a full merger stalled last December, and Vodafone has been looking to sell their stake ever since. Now the UK's Sunday Times confirms those stalled merger talks and the fact that Vodafone is looking to make a very profitable exit from the United States wireless industry as quickly as possible. The report claims that Vodafone could stand to make as much as $135 billion from a sale of their share of Verizon Wireless.

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Dr Demento
I Vant Blud

join:2002-01-02
Denville, NJ

2 edits

Sees Writing on the Wall

That VZW is a one trick pony (marketed as best nationwide coverage) and except for wealthy families it's basically a suckers' provider (only sells expensive capped shared data plans) who's marketshare will get slowly eaten away by other carriers more willing to take a risk. At least they'll make a nice tidy profit from it.

Linklist
Premium
join:2002-03-03
Williamstown, NJ
kudos:5

Re: Sees Writing on the Wall

said by Dr Demento:

That VZW is a one trick pony (marketed as best nationwide coverage) and except for wealthy families it's basically a suckers' provider (only sells expensive capped shared data plans) who's marketshare will get slowly eaten away by other carriers more willing to take a risk. At least they'll make a nice tidy profit from it.

Well somehow they got to 98 million retail customers. Must be a lot of suckers in the US.
puck0114

join:2005-12-24
Portland, OR

Re: Sees Writing on the Wall

There are.

no_one

@cox.net
Still have customers with grandfathered plans.

hey hey hey

@charter.com
said by Dr Demento:

That VZW is a one trick pony (marketed as best nationwide coverage) and except for wealthy families it's basically a suckers' provider (only sells expensive capped shared data plans) who's marketshare will get slowly eaten away by other carriers more willing to take a risk. At least they'll make a nice tidy profit from it.

What carrier? Sprint and t-mobile ignore over 1/3 of the country. At&t offerings aren't any cheaper than Verizon. So whatever. funny how Verizon got more customers in quarter 4 alone than at&t, Sprint and t-mile got ALL year COMBINED.

Dr Demento
I Vant Blud

join:2002-01-02
Denville, NJ

1 edit

Re: Sees Writing on the Wall

said by said by hey hey hey :

At&t offerings aren't any cheaper than verizon.


Yout mean the second largest company that spawned from the vampiric SBC buying out viable Cingular in a loose regulatory environment, changed its name to capitalize on nostalgia and the largest 'me too' ran business that never thought up ano original idea since ponying up the most money to buy exclusivity for the iPhone? Horrible comparison that makes your argument a strawman.

said by hey hey hey :

What carrier? Sprint and t-mobile ignore over 1/3 of the country. At&t offerings aren't any cheaper than Verizon.

Well that's thanks in part to our supposed agency for managing competition in communications Ok'd carriers that served those areas such as US Cellular and Alltel being bought out by said titans.

VZW isn't going to implode over night but it's slow decline will be evident and the hedge fund market that encouraged it's existence and growth will announce it's fall.

hey hey hey

@charter.com

Re: Sees Writing on the Wall

said by Dr Demento:

said by said by hey hey hey :

At&t offerings aren't any cheaper than verizon.

Yout mean the second largest company that spawned from the vampiric SBC buying out viable Cingular in a loose regulatory environment, changed its name to capitalize on nostalgia and the largest 'me too' ran business that never thought up ano original idea since ponying up the most money to buy exclusivity for the iPhone? Horrible comparison that makes your argument a strawman.

No it doesn't, it's a legit question. You claim Verizon's business practices will entice a huge percentage of their customers to leave. I asked where are these customer going to go? A large percentage live in area where they are the only carrier or at&t is the only alternative. In which you see to agree isn't any better.

Even in areas that have t-mobile and Sprint they aren't any better. For some maybe. For others not so much.

ilikeme
I live in a van down by the river.
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Denton, TX
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said by hey hey hey :

said by Dr Demento:

That VZW is a one trick pony (marketed as best nationwide coverage) and except for wealthy families it's basically a suckers' provider (only sells expensive capped shared data plans) who's marketshare will get slowly eaten away by other carriers more willing to take a risk. At least they'll make a nice tidy profit from it.

What carrier? Sprint and t-mobile ignore over 1/3 of the country. At&t offerings aren't any cheaper than Verizon. So whatever. funny how Verizon got more customers in quarter 4 alone than at&t, Sprint and t-mile got ALL year COMBINED.

Agreed. Around here AT&T and Verizon have the best coverage. I have tried each of the big 4. AT&T and Verizon both have very good coverage, even in the more rural areas and have decent LTE coverage. Don't get your hopes up about using Sprint or T-Mobile outside of the major cities, they will most likely be roaming with reduced speed or no data, or will have SOS service only. Plus Sprints LTE network is a joke. Don't even bother trying to use the "Ghetto Phone(Cricket, Metro, etc)" providers in rural areas, or even in a lot of other areas of the cities.
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Re: Sees Writing on the Wall

Funny you should mention Sprint. These days, they have more of central TX covered land area wise than Verizon with LTE...and it's solid coverage too. Granted, they launched a few of their markets much too early (DFW, Austin) and as such didn't/don't have comprehensive LTE there upon launch. But unlimited data on a network that I've seen hit 35 Mbps down and 13 Mbps up (but averages closer to 15/5) isn't a joke by any stretch.

ilikeme
I live in a van down by the river.
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Re: Sees Writing on the Wall

said by iansltx:

Funny you should mention Sprint. These days, they have more of central TX covered land area wise than Verizon with LTE...and it's solid coverage too. Granted, they launched a few of their markets much too early (DFW, Austin) and as such didn't/don't have comprehensive LTE there upon launch. But unlimited data on a network that I've seen hit 35 Mbps down and 13 Mbps up (but averages closer to 15/5) isn't a joke by any stretch. In most rural areas I tried it in Sprint dropped to EVDO or 1x while Verizon had LTE and AT&T had at least HSPA if not LTE

Not really. I tried them recently and the coverage was horrid (especially indoors) compared to what I get on Verizon and AT&T in DFW, Houston, and Austin. Speeds were also lower. On Verizon I average about 40/10 and At&t is usually between 40-60Mbps/10-15 up. I don't see a point in having unlimited data when I could hardly use it.
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iansltx

join:2007-02-19
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Re: Sees Writing on the Wall

How recently? Summer/fall 2012, I would agree with you. It's gotten better since.

Black_Mage
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said by ilikeme:


Don't get your hopes up about using Sprint or T-Mobile outside of the major cities,

Seems like Sprint is rolling out 4G everywhere EXCEPT major cities.
xenophon

join:2007-09-17

Re: Sees Writing on the Wall

said by Black_Mage:

said by ilikeme:


Don't get your hopes up about using Sprint or T-Mobile outside of the major cities,

Seems like Sprint is rolling out 4G everywhere EXCEPT major cities.

Uh, take a closer look...
»sensorly.com/map/4G/US/USA/Sprin···10sprint
Crookshanks

join:2008-02-04
Northeast PA
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said by Dr Demento:

That VZW is a one trick pony (marketed as best nationwide coverage) and except for wealthy families it's basically a suckers' provider

You think someone is a sucker for taking coverage into account when purchasing a mobile phone? There's a perfectly viable and relatively cheap solution for people who don't care about coverage: POTS

Dr Demento
I Vant Blud

join:2002-01-02
Denville, NJ

Re: Sees Writing on the Wall

said by user Crookshanks :

You think someone is a sucker for taking coverage into account when purchasing a mobile phone? There's a perfectly viable and relatively cheap solution for people who don't care about coverage: POTS

Most people typically don't travel around the country most of the time. FCC mandated data roaming agreements are making it possible for other carriers who offer post-paid plans to offer more comprehensive nationwide ones for when people need them. Many people in the US, due to the inability of affording fuel and maintenance costs, are not buying SUVs if they only go offroad a little if not at all, this may have a correlated affect when looking at other services.
Crookshanks

join:2008-02-04
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Re: Sees Writing on the Wall

You don't have to travel "around the country", Verizon simply has better coverage in a lot of markets than the other carriers. Punch up Northeast PA or Upstate NY, they beat AT&T hands down, Sprint only competes because you can (for now) roam on Verizon, and T-Mobile is useless once you wander off the highway.

Heck, even within the urban areas Verizon tends to best T-Mobile (my favorite carrier from a cost/customer service standpoint), particularly with regards to indoor coverage. AT&T is probably more competitive in these markets with regards to coverage, though I can't understand why anybody would do business with them when they cost just as much as Verizon without the extensive network to back up their arrogance.
xenophon

join:2007-09-17

Re: Sees Writing on the Wall

said by Crookshanks:

Sprint only competes because you can (for now) roam on Verizon,

Sprint has an agreement for 10 more years with VZW and has many other regional partners outside VZW. And Feds already said VZW will need to offer roaming in long term even if Sprint needs them after 10 years.

CylonRed
Premium,MVM
join:2000-07-06
Bloom County
They have really good coverage here and I have a 8-9 year old phone. 4 phones (2 with texting) costs us about $25 phone. Never use more than 100 minutes or so.

When the kids get phone I might try straight talk but since everyone we talk to is on Verizon - straight talk may cost us more.

Maybe if I get a smart phone but I don't know when I would at this point...
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tmc8080

join:2004-04-24
Brooklyn, NY

silver lining for competitors

know where that leaves Verizon..? even a small alliance between AT&T and Google could crush Verizon, wireless, wire line lock-stock-and-barrel
jagged

join:2003-07-01
Boynton Beach, FL

Re: silver lining for competitors

I'm guessing Verizon would have to borrow $135B to complete the sale

jgkolt
Premium
join:2004-02-21
Lakewood, OH

Re: silver lining for competitors

did it say that verizon was buying all of those shares?

tshirt
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Re: silver lining for competitors

Verzion has right of first refusal, and each of the 2 wanted to buy out the other for years, I think vodaphone FINALLY recognized Verizon would NEVER sell or even merge without taking more value then VZW is worth. Somedays taking your ball (money!) and going home is the smart play.

hey hey hey

@charter.com
said by tmc8080:

know where that leaves Verizon..? even a small alliance between AT&T and Google could crush Verizon, wireless, wire line lock-stock-and-barrel

Keep dreaming. Even if at&t could get 100% of Verizon's customers they certainly don't have the capacity to handle them all.
tmc8080

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Re: silver lining for competitors

said by hey hey hey :

said by tmc8080:

know where that leaves Verizon..? even a small alliance between AT&T and Google could crush Verizon, wireless, wire line lock-stock-and-barrel

Keep dreaming. Even if at&t could get 100% of Verizon's customers they certainly don't have the capacity to handle them all.

The lynch-pin of this strategy is the lucrative northeast market. If Verizon falls, ehm FAILS here, they basically fail everywhere! An alliance btw AT&T and Google could do just that. AT&T is a global network company, who proved they have no love for last mile. Google is a portal which wants future revenue diversification and last mile is a sure bet. They did not spend millions of dollars just for a petty experiment. Bringing a global tier-1 ISP together with Google solves various funding & technical problems each other face going forward.

Most people know AT&T as the deathstar, but take away their fight with Verizon and it's a much less evil corporation. I'm just floating the idea, no dobut the people @ google would say not even with use of Comcast's genitals would this type of alliance work.

Ideally, VZ wireless assets divided between the non-at&t competitors would reset the market to the competitiveness of when 3g was new-- with better technology & lower prices.

Rob212

@optonline.net

Cost

Does that come out to about 1000$ per subscriber?
Zach 58
Premium
join:2006-11-26
NW Minnesota

Re: Cost

They'll just add a $2 per line "Vodafone buy-out fee" to our bill in order to "serve us better". It will go nicely with their bullshit "Administrative fee".
--
Zach

Probitas

@teksavvy.com

what if...

Vodafone ends up selling to another start up?
iansltx

join:2007-02-19
Golden, CO
kudos:2

Re: what if...

Who has $135B lying around? Other than maybe Apple or Google?

hey hey hey

@charter.com

Re: what if...

said by iansltx:

Who has $135B lying around? Other than maybe Apple or Google?

You do realize it's not that Verizon writes a check for $135 bil. In fact that is the LAST thing Vodaphone would want.

Miataman

join:2010-10-27
Chelmsford, MA
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·Verizon FiOS
said by iansltx:

Who has $135B lying around? Other than maybe Apple or Google?

. What a cluster of a bidding war that would be!
I can see "raining paper" on Wall St.
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IowaCowboy
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Verizon Communications

I think Verizon should buy out Vodafone's stake in VZW so VZW can become an all American company and keep the profits here at home.

If Verizon merges with AT&T and they buy out CenturyLink then we'll be back to the days of the Bell monopoly. What started out as 7 regional telephone companies after the Bell divestiture is now down to three (VZ, AT&T, and CenturyLink) major phone companies. Sprint used to sell long distance and T-Mobile never had a stake in the wireline business.

Had Bell system never have been broken up, I'm sure they'd be the only wireless provider as well and at three times the cost of VZW.

The Bell breakup was a good thing. Otherwise we'd be paying three times as much for wireless and wireline communications.
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Network Guy
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Re: Verizon Communications

said by IowaCowboy:

I think Verizon should buy out Vodafone's stake in VZW so VZW can become an all American company and keep the profits here at home.

By keep the profits here at home, I'd guess you mean CEO's coffers.
en103

join:2011-05-02

Re: Verizon Communications

I'd say it really means...
Be able to tax an American company on the full profits vs. giving 40% overseas.

The real profits are eaten up by shareholders which can be from anywhere.
Skippy25

join:2000-09-13
Hazelwood, MO
Please clarify what you mean by keeping the profits here at home.

Last time I checked profits went to stockholders and in this day and age those stockholders are all over the world.

That is the fallacy of "Buy American" that exist today. Unless that company is 100% owned by Americans then some part of that companies profit is going to another country and vice versa.

Frink
Professor
Premium
join:2000-07-13
Scotch Plains, NJ

Re: Verizon Communications

One thing I can say about VZW and the 'Buy American' generality, VZW employs a significantly higher percentage of US based workers than many other companies of their size out there. They might not even outsource at all. That is significant when you are talking about American employment.
OwlSaver
OwlSaver
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Possible Deals

Here is my guess of what could happen:

- Verizon buys all shares (if they can spend $135 Billion on half of VZW, they could wire the country for FiOS - but that is a different story)

-Verizon passes and a venture firm buys the shares (unlikely since Verizon does not like sharing with Vodafone)

-Verizon dilutes existing shareholders and issues enough new share to buy the company (most likely, nothing like playing with other peoples money).

I would expect some combination of the above. Does anyone know how much cash Verizon currently has?

See 7 replies to this post

some vz tech

@140.108.1.x

VZW grew from VZ Wireline..

All those VZW profits were built on the wireline side of the house that they are allowing to shrivel. The FiOS product is superior to anything on a pole - or in the air for that matter; yet there are no plans to expand the coverage, regardless of how much demand there is for it. There are far more profits to be reaped from wireless - with low caps and outrageous data fees. Plus, they get the wireline side of the transport which is required for each and every call FREE of charge (even if two wireless callers were standing next to each other)! That's right - they don't pay VZ for that - which is why the wireline is "unprofitable." They let the wireline carry the lion's share of the call distance, provide the switching, directory assistance, line maintenance, etc. for free - which shifts costs (and red ink) to the wireline side (and where VZ's unionized workforce is) - life is a party in the wireless side of the house. Those fancy smart phones are just expensive flashlights & cameras without a solid wireline network and infrastructure to support it.

Frink
Professor
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Re: VZW grew from VZ Wireline..

Thanks for the laugh! So very inaccurate...

PhoenixDown
-- Wants FIOS
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Re: VZW grew from VZ Wireline..

That post was inaccurate in so many ways, but its okay ...
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Add a signature here

PGHammer

join:2003-06-09
Accokeek, MD
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·Comcast
And look at WHY there are no plans to expand the coverage beyond where it is - it's pricey. Worse, where VZ has deployed it, they were forced (by the PUCs) to overbuild their copper network; result, they were forced to run two different networks, which means AT LEAST double the operating costs. Yes - fiber is cheaper down the road; however, initial costs are humongous. (I live in a state - Maryland - which has a LOT of VZ fiber deployed; however, in most of that same area, VZ also has a lot of legacy copper - running two networks - even two wireline networks - isn't cheap.) Greenfield deployments (regardless of the provider) are ALWAYS going to be cheaper than overbuilding, and especially overbuilding your own network.

ShadowMastr
Master Of All Shadows

join:2001-09-01
Fort Pierce, FL

psssstttt....

........ maybe att should buy that 45% share....... either consolidate or be crushed from within.......

so sayeth The Death Star!
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good for vodafone

Vodafone had never any real influence on VZW policies, in spite of 45% stake. They are essentially a silent partner. They are better off taking the cash and do their own things, assumed that their managers knows what to (sensibly) do with the money ( some share holders think that they do not).
travanx

join:2002-01-15
Glendale, CA

Vodaphone?

Interesting as Vodaphone is leaving sponsorship of McLaren in Formula1. What is Vodaphone planning to do with all this extra money?

Miataman

join:2010-10-27
Chelmsford, MA
Reviews:
·Verizon FiOS

Re: Vodaphone?

said by travanx:

Interesting as Vodaphone is leaving sponsorship of McLaren in Formula1. What is Vodaphone planning to do with all this extra money?

Buy Cyprus ?
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