Verizon Wireless to Invest More Than $3 Billion in Its Network in 2000, Will Introduce Coast-to-Coast Short Messaging
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NEW YORK, NY - Verizon Wireless, the new company formed by the U.S. wireless interests of Bell Atlantic Corporation [NYSE: BEL] and Vodafone AirTouch Plc [LSE: VOD; NYSE: VOD], today unveiled plans to continue to strengthen its network to provide the nation's best wireless service for its rapidly growing customer base. The two companies today begin operating as one company along with their joint venture PrimeCo Personal Communications. Later this quarter, when Bell Atlantic and GTE Corporation [NYSE:GTE] are targeting the close of their merger, Verizon Wireless will be further strengthened by the assets of GTE Wireless. At that time Verizon Wireless will serve more than 90% of the U.S. population and 96 of the top 100 U.S. wireless markets. The new company will invest more than $3 billion in its nationwide network in 2000. This capital investment, one of the largest ever announced in the industry, will further expand the digital footprint and increase capacity for wireless voice and data services provided to the new company's more than 23 million customers. Planned network enhancements, technology trials and new services include:
- Introduction of the nation's first wireless two-way short messaging service
- Testing of third-generation network technology through field trials
- Rapid expansion of its CDMA digital network
- Wireless network support for OnStar's personal calling feature
- Deployment of over-the-air provisioning via its CDMA digital network
According to Richard Lynch, executive vice president and chief technical officer of Verizon Wireless, the new company will leverage its scale, achieving synergies from its $3 billion investment in network equipment purchases to accelerate the rapid deployment of CDMA service and to lay the groundwork for third-generation (3G) services.
"Continued investment in our CDMA network will enable Verizon Wireless to extend CDMA digital voice and data services to areas in the footprint where they aren't available today," said Lynch. "In addition, this investment will allow the company to rapidly introduce new services including two-way short messaging capabilities. In June, we will begin testing the next generation of wireless technology through field trials with our infrastructure vendors. In these trials, we will demonstrate data access speeds of 144 KBPS."
New Services and Revenue Opportunities
In collaboration with infrastructure vendors Lucent Technologies and Nortel Networks, Verizon Wireless will be the first wireless carrier in the country to offer nationwide two-way short messaging service (SMS). Initially, the service will be delivered using Kyocera and Motorola handsets. The service will be offered in the third quarter of 2000. Advanced two-way messaging enables mobile users to send text messages to other compatible mobile handsets or other Internet users. Messages can even be sent while the subscriber is on a voice or data call. Subscribers have the ability to either compose their own messages using the keypad or to select a standard message that is stored in their handset. Other features associated with two-way SMS include Delivery Confirmation indicating that a message has been received and User Acknowledgement, which allows the subscriber to respond to common inquiries (i.e., Press 1 for Yes and Press 2 for No). The new service will extend mobile communications to more interactive applications that benefit from two-way messaging, such as "e-mail-on-the-run" to keep in close contact with friends, family and business associates.
General Motors' OnStar will be one of the first national customers to take advantage of the new company's coast-to-coast network when OnStar extends its portfolio of market-leading, in-vehicle services this year to include a personal calling feature. Verizon Wireless will provide the backbone wireless network for the personal calling feature, which OnStar estimates will be carried by more than four million vehicles nationwide within the next three years.
Beginning immediately, Verizon Wireless will accelerate the deployment of over-the-air (OTA) provisioning via its CDMA digital network. OTA provides for remote activation and telephone number and area code changes. It will soon be enhanced to provide updates to the software in wireless phones, ensuring that Verizon Wireless' customers remain on the company's preferred network as they travel. Future enhancements will allow the company to perform diagnostics and software upgrades on wireless phones.
Comprehensive Suite of Data Services
Verizon Wireless offers easy-to-use wireless access to the Internet via its CDMA digital network. Featuring Web-enabled digital wireless phones that have built-in modems, Verizon Wireless customers can surf the Web, send and receive e-mail, get real-time stock market analysis and quotes, and set up customized personal Web pages. Delivered over Verizon Wireless' network, customers also gain menu-driven wireless connectivity to Web-based content providers on demand, like online travel information and reservations, real-time airline flight status reports, and door-to-door travel directions.
In addition to CDMA data, Verizon Wireless offers one of the nation's largest Cellular Digital Packet Data networks (CDPD). CDPD offers Internet access at data speeds of up to 19.2 KBPS and is often the preferred choice for heavy wireless Internet users who require an "always on" connection. Delivered via laptops, handheld PDAs and Window CE devices, CDPD is ideal for a variety of applications, including wireless credit card verification and automated teller machines, and remote meter reading.
Verizon Wireless' digital wireless network covers more than 75% of the company's potential customer base. At the same time, Verizon Wireless continues to operate the largest, most ubiquitous analog wireless network in the country. This dual-network advantage allows Verizon Wireless to migrate subscribers to the company's CDMA digital network quickly and at the same time provide existing and new customers with superior analog coverage in parts of the country where competing national carriers have yet to build out their networks.
"CDMA has proven itself as the best, most spectrally efficient digital service in the industry. Customers enjoy the excellent voice quality, inherent enhanced features and the convenience of data embedded in the basic service. Plus, the technology offers a clear and cost-effective path to 3G technologies," said Lynch. "Network quality has been and will remain our number one focus, and to this end, we will build aggressively until CDMA digital voice and data reaches every part of our footprint."
Network Is the Product
In 1999, the companies that make up Verizon Wireless won the J.D. Power and Associates 1999 U.S. Wireless Customer Satisfaction award in Boston, Chicago, Houston, Los Angeles, New York, San Diego, Seattle and St. Louis. Lynch expects this list of cities to grow in 2000 as Verizon Wireless executes this aggressive network plan and customers begin to reap the benefits of its premier service.
"Our new company's name, Verizon Wireless, comes from two roots -- the Latin 'veritas,' which connotes certainty and reliability; and 'horizon,' which signifies the possibilities ahead," said Lynch. "Verizon Wireless' reputation and legacy will be built upon unparalleled network engineering combined with cutting-edge technology, to deliver superior wireless voice and data services that can be accessed virtually anywhere in the country."
In separate press releases today, Verizon Wireless also announced the following:
- The formal close of the combination of Bell Atlantic Corp.'s and Vodafone AirTouch Plc's U.S. wireless properties and the new marketing and branding effort in support of the Verizon Wireless launch
- The introduction of new, nationwide flat-rate SingleRate pricing plans for consumers and businesses, as well as a series of wireless data-related initiatives
- New appointments to Verizon Wireless leadership and an overview of the senior management team.
The press releases can be found on Verizon Wireless' Web site (http://www.verizonwireless.com/mediacenter). All were issued over PR Newswire this morning.
About Verizon Wireless
Verizon Wireless is the largest wireless communications provider in the U.S. with over 16 million wireless voice and data customers and nearly 4 million paging customers. The new coast-to-coast wireless provider was formed by the combination of the U.S. wireless businesses of Bell Atlantic Corp. (NYSE:BEL) and Vodafone AirTouch Plc (LSE:VOD; NYSE:VOD). The new company includes the assets from Bell Atlantic Mobile, AirTouch Cellular, PrimeCo Personal Communications and AirTouch Paging.
Verizon Wireless will be further strengthened by the addition of the wireless assets of GTE Corp. (NYSE:GTE) when it completes its merger with Bell Atlantic. When the merger is complete, the new company will have a footprint covering more than 90% of the U.S. population, 49 of the top 50 and 96 of the top 100 U.S. markets.
Verizon Wireless, headquartered in New York City and Bedminster, NJ, is 30,000 employees strong.