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Rural Cellular sues Alltel for trying to steal customers from sold markets
Last year, Rural Cellular bought a handful of Minnesota markets from Alltel. No big deal, right? A little money changes hands, a few subscribers move from one carrier to another. As part of the sale, Alltel agreed to continue to service the customers until they could be fully migrated to Rural's systems -- problem is, they may have "serviced" them a little too hard, if you catch our drift. A lawsuit brought on by Rural claims that, among other things, Alltel hustled the affected customers really hard during the transition period to get them to switch back to Alltel and offered them "slipshod" service on Rural's transitional network to help make that decision a little easier. By the time all was said and done, subscriber churn in the markets was a sky-high 13 percent, certainly suggesting that there was some buffoonery going on. The suit seeks millions in damages on the $48 million deal -- and with Verizon's acquisition of Rural currently going through the regulatory process, it certainly seems like the outcome could have an effect.[Thanks, Droo]
Verizon Wireless to buy Rural Cellular for $2.67 billion
Another one bites the dust, so to speak. This time around, we've got Verizon Wireless doing the acquiring, as it has just announced plans to pay $2.67 billion for "one of the nation's largest rural carriers," Rural Cellular. The news comes just over a month after AT&T handed over a staggering amount of its own to pick up Dobson Communications, and this agreement will expand the carrier's coverage "in parts of the East Coast and the South, as well as in Minnesota, North Dakota, South Dakota, Wisconsin, Kansas, Idaho, Washington and Oregon." Verizon did note that it planned on deploying CDMA service in Rural Cellular's existing GSM markets in order to convert customers over, but it also mentioned that the existing GSM networks would remain to "serve the roaming needs of other GSM carrier's customers." Look for the deal to be finalized sometime during the first half of next year, and don't be surprised if we see a few more consolidation efforts go down in the meantime.
