Two US telecoms look to expand into cell market

Say goodbye to one national cellphone company, and hello to two more.

While the industry is hopeful that the buyout of AT&T Wireless by Cingular Wireless will ease competition by eliminating one national rival -- and possibly more if the merger prompts more deals -- two other telephone companies are poised to crowd the market with their own national wireless offerings.

Qwest Communications, the local phone company across the Rocky Mountains and Northwest, is was to expand its regional cell service yesterday with the introduction of national coverage and calling plans.

The services will be provided over Sprint Corp's wireless network under the Qwest Wireless brand, which currently has nearly 1 million subscribers on regional calling plans.

The Qwest launch comes only days after AT&T Corp, former parent of AT&T Wireless, asserted that it too would likely introduce a "virtual" mobile-phone service using another company's network.

The service would probably be sold under the AT&T Wireless brand, which AT&T will regain control of after its former subsidiary is acquired by Cingular.

The moves by Qwest and AT&T offer further confirmation that the bundling of multiple services -- telephone, Internet, wireless and video -- on a single bill is becoming a must-have product in the telecommunications business.

"Our focus is really on how can we offer the best telecommunications bundle to our customers, and wireless is an important part of that bundle," said Paul Golden, vice president of product management for Qwest. "That's how we need to compete in the market place."

In such an environment, some strategists question whether pure cellular businesses such as Nextel Communications and T-Mobile might be forced into mergers or at least an alliance with a non-wireless company such as AT&T or MCI.

For Sprint, which also serves as the behind-the-scenes carrier for a youth-marketed cell service called Virgin Mobile, the wholesale revenue from Qwest helps defray the hefty cost of operating a wireless network.

At the same time, it is unclear if the competition from yet another rival might intensify the price wars that Sprint and others are hoping might ease some with the departure of AT&T Wireless.

Fortunately for the competition, Qwest primarily views its new national coverage as a means to retain and attract customers within its home territory, so the company isn't planning to wage a coast-to-coast battle.

"Our focus is in our 14-state region, focusing back on where our Qwest customers already are, where we can market a robust bundle," Golden said.

That focus, however, could evolve as the non-geographic nature of voice-over-Internet phone service blurs the traditional boundaries of a Bell company's "territory."