Those rivals came into existence only after AT&T Wireless showed that offering national coverage was technologically and economically feasible.
The company received numerous awards for excellent service, and by 2000 several publications, including Forbes and PC Magazine, had named it the country's best wireless network.īut soon after that, even with the $7 billion it retained from its initial public stock offering, AT&T Wireless started losing out to its competitors - companies that hadn't even existed a year earlier. It led the industry, creating the first national coverage plan with no roaming or long-distance fees. By the end of 1997, AT&T Wireless had become by far the nation's largest cellular provider.
"When we came over (to AT&T), we felt we were hooking ourselves to a star," said former McCaw Cellular spokesman Bob Ratliffe.Īt first, it seemed that combining the companies had indeed created a winner. Ten years before, the tiny cellular division at telecommunications giant AT&T Corp., based in New Jersey, got a kick-start of 2 million subscribers when it bought McCaw Cellular for $11.5 billion.Īnxiety mixed with excitement among McCaw staffers, who feared losing the spirit of their entrepreneurial organization but believed that taking on the AT&T brand, experience and war chest would propel the small company into one that could dominate in the new, evolving market. Its trajectory could have been very different. But it means Seattle will say goodbye to yet another major corporation - one that began as McCaw Cellular Communications, a storied local company that has generated some of the region's most influential and innovative business leaders. The takeover is good news for those shareholders who receive a premium on a historically anemic stock. The deal, which could close as early as next month, likely will be followed by massive layoffs among the company's more than 31,000 employees - 5,700 of whom live in the Puget Sound region. Atlanta-based Cingular Wireless agreed to pay $41 billion in the largest cash takeover in U.S. Onto the auction block the company went, selling itself to the highest bidder. "When wireless portability came along, it became clear AT&T Wireless was losing, so they put themselves up for sale," said Derek Kerton, principal analyst with wireless-consultancy The Kerton Group. Customers were making a choice, and that choice was not AT&T Wireless. 1 carrier Verizon Wireless, were snapping them up. They couldn't wait to get away from us."īy the spring, it was obvious not only that AT&T Wireless was hemorrhaging customers but also that rivals, especially No. "But they walked away flipping us the bird. "The line from the company was that we lost those people out of bad luck," said a regional sales manager. Years of substandard customer care, spotty coverage and dropped calls had taken their toll. In the first three months of this year, millions of subscribers fled the company. The portability rule's object was to increase competition by letting customers choose the best service without penalty.įreedom of choice meant a financial and public relations disaster for AT&T Wireless.
In the end, a single event may have sealed AT&T Wireless's fate: the opportunity for its customers to leave.Ī mass exodus from the Redmond carrier began late last year when, compelled by a new federal rule, wireless companies let subscribers switch among them while keeping their phone numbers. DAN RICHMAN SEATTLE POST-INTELLIGENCER REPORTER, 09.21.04, 10:50 AM ET