Cingular, a venture of BellSouth Corp and SBC Communications Inc, has alliances with AT&T Wireless and VoiceStream to speed the introduction of new services. One may lead to a merger, said Todd Rethemeier, a Bear Stearns & Co analyst.
VoiceStream CEO John Stanton said he wouldn't "speculate on what VoiceStream might or might not do."
Cingular spokesman Clay Owen declined to comment.
Competition among carriers heated up in the fourth quarter, as VoiceStream, the seventh-largest mobile-phone company, slashed prices, poaching Verizon Wireless and Sprint PCS customers.
AT&T Wireless expects more customers on lower-priced monthly plans paying lower bills, Chief Executive John Zeglis said.
"Our average revenue per customer is going to come down as we penetrate deeper into the population and target segments that may only spend US$30 or US$40 per month," Zeglis said in an interview. The fourth-quarter average monthly bill was US$60.80.
The company doesn't need a merger partner, he said.
By offering more free time for calls, AT&T Wireless cut per- minute prices on one plan 33 percent, while Verizon Wireless cut one rate plan 29 percent, Lehman Brothers analysts estimated.
Lower prices give regulators a way to show they're helping consumers. Yet, they vex shareholders.
"As an investor, you want less price pressure," to help sustain growth in sales and cash-flow margins, said Larry O'Connell, an analyst at American Express Financial Advisors Inc.
Nextel Communications Inc may be without a partner, analysts said. The software used in Nextel's walkie-talkie feature, widely used in the workplace, is incompatible with other systems.
CEO Tim Donahue said he's not seeking a buyer, though his company -- with as many as 12 million business customers -- would be an alluring target.
"There's a lot of people out there that would love to have this kind of customer base," he said.
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