Verizon agreed to buy TracFone, a provider of wireless prepaid services, in a deal worth up to $7 billion in cash and stock, further consolidating the US cellular market. TracFone, a unit of Mexico’s América Móvil SAB, has about 21 million prepaid customers in the US under its namesake brand as well as StraightTalk and Net10. The company doesn’t run its own physical network in the US and instead rides on other cellphone carriers’ systems for a fee and then resells service under its own brands.
Randall L. Stephenson, AT&T’s chief executive, said in a staffwide memo that the company had made a “big mistake” by hiring President Trump’s personal lawyer, Michael Cohen.
Apollo Global Management agreed to pay about $5 billion to acquire Yahoo and AOL from Verizon as the wireless company exits its ill-fated foray into the media business. The private-equity firm is paying $4.25 billion in cash for a 90% share of the media assets. Verizon will keep a 10% stake and $750 million of additional preferred stock in the new company, called Yahoo, that will be formed to operate the business. Verizon Media, which mostly struggled to grow against Alphabet's Google and Facebook, generated $7 billion in revenue in 2020.
The fastest-growing mobile-phone carriers in the US aren’t phone companies. More than five million Americans now pay for mobile-phone service through their cable-TV providers, enticed by low prices and the ability to easily adjust their phone plans, a flexibility that proved particularly useful during the pandemic.
The Federal Communications Commission has been in overdrive in recent months as billions of dollars in 5G investments put new demands on its staff. The coronavirus pandemic has complicated matters even more by highlighting the millions of Americans who lack broadband access for work and school. The FCC’s earliest 5G-focused auctions sold off millimeter-wave licenses, which support extremely fast internet connections but suffer over long distances.
Cellphone carriers that spent years promoting their blueprints for new fifth-generation wireless networks devoted the past week to explaining how they plan to pay for them. AT&T and Verizon said they would spend billions of dollars more in the coming years on cellular-tower equipment, fiber-optic lines, and other infrastructure to use new wireless spectrum licenses they acquired through a federal government auction. T-Mobile said it would put the new licenses to use without increasing its capital budget.
AT&T agreed to sell a stake in its pay-TV unit to private-equity firm TPG and carve out the struggling business, pulling the telecom giant back from a costly wager on entertainment. The transaction would move the DirecTV and AT&T TV services in the US into a new entity that will be jointly run by the new partners. AT&T will retain a 70% stake in the business. TPG will pay $1.8 billion in cash for a 30% stake.
The telecom industry turned out in force to oppose a recent Pentagon proposal to build a shared fifth-generation wireless network, with a familiar pot-stirrer making an exception: Dish Network. The satellite-TV company submitted a list of suggestions for the Department of Defense, which is exploring 5G technology for its own operations.
The digital divide hasn’t gone away, despite much money spent and many speeches made. A patchwork of conflicting government programs, flawed maps, and weak enforcement have left broad swaths of the country without access to high-speed or even basic internet service when people need it more than ever. The result is a longstanding source of personal frustration and economic disadvantage for many rural communities in areas where spread-out housing makes adding new wires expensive.
US officials are exploring concepts for a new 5G wireless network that would let Silicon Valley giants and other businesses tap valuable Pentagon airwaves, setting up a potential clash over how to deploy the next-generation technology. The Department of Defense issued a request for information that could open the door for investors to bid on contracts to build a domestic cellular network for both the military and for commercial operators.