Leading wireless carrier,
Verizon Communications Inc.
) is reportedly acquiring spectrum assets worth $210 million from
Cincinnati Bell Inc.
). Verizon will first purchase Cincinnati Bell's spectrum
licenses which account for $194 million of the total purchase
As reported, the deal is expected to close by the second half
of this year. We believe the new spectrum acquisition will boost
Verizon's wireless infrastructure and aid in its future network
For Verizon, the new spectrum will bring licenses for key
markets like Greater Cincinnati and Dayton, Ohio areas of
northern Kentucky and southeastern Indiana. In these areas,
Cincinnati Bell reportedly offered GSM-based 2G, 3G and HSPA+
services via 460 cell sites.
The deal is expected to be followed by winding up of
Cincinnati Bell's wireless operations, which remains highly
challenged by competition from large national carriers.
As of Dec 2013, Cincinnati Bell covered around 340,000
wireless customers, which is less than 398,000 in 2012.
Cut-throat competition in the wireless arena and increasing
penetration of large carriers is resulting in its customer losses
and business deterioration. As a result, Cincinnati Bell expects
to wind up its wireless operations within 8-12 months following
the spectrum deal closure with Verizon.
Cincinnati Bell is reportedly planning to lease back certain
spectrum licenses from Verizon to carry on mobile operations
before closing business. It will, however, continue focus on
growing its bundled services in TV and broadband segment and
expand its Foptics brand.
Both Verizon and Cincinnati Bell currently carry a Zacks Rank
Better-ranked stocks in the telecom sector include
SK Telecom Co. Ltd.
Shenandoah Telecommunications Co.
). Both SK Telecom and Shenandoah carry a Zacks Rank #1 (Strong
CINCINNATI BELL (CBB): Free Stock Analysis
SHENANDOAH TELE (SHEN): Free Stock Analysis
SK TELECOM CO (SKM): Free Stock Analysis
VERIZON COMM (VZ): Free Stock Analysis Report
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