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TwitterVerizon Communications Inc. Chief Executive Ivan Seidenberg said he does not see much reason to strike a deal with Vodafone Group PLC.
There has often been speculation on the future of their joint venture, Verizon Wireless. Mr. Seidenberg, speaking during a conference hosted by the Council on Foreign Relations on Tuesday, said he would eventually like to resolve the joint venture structure. He has often said he would like to buy out Vodafone’s stake in Verizon Wireless, but didn’t provide a timetable.
Verizon owns a controlling stake in the carrier ie. Verizon owns 55 percent of Verizon Wireless and Vodafone owns the remaining 45 percent. Mr. Seidenberg has however, dismissed all rumours of a larger alliance, or a merger. “There’s no compelling reason that this is an exciting thing to do,” he said during a conference hosted by the Council on Foreign Relations. Though he also added the proverbial never-say-never-clause, by saying that his opinion on a merger wasn’t the final position and that things may change.
The model of a global wireless company, which is what Vodafone is, isn’t the preferred one, he said. At some point, that model would lose economies of scale, he added, noting that a combined company would have a difficult time finding enough growth to justify the merger.
In comments on the proposed National Broadband Plan, Mr. Seidenberg said he is concerned the plan could lead to an “overreach” of regulation that could cut into private investment.
Verizon not interested in Vodafone ?
Mr. Seidenberg also commented on the potential of Verizon Wireless getting the Apple Inc. iPhone, saying he has expressed interest in bringing it to the carrier. But he said he doesn’t know when it would happen, and that it would be Apple’s call.
“We’re open to getting the device,” he said. “Our network is capable of handling it.”
Mr. Seidenberg declined to comment on whether it would run on Verizon Wireless’ current third-generation, or 3G, network, or the 4G one, which is scheduled to be rolled out in the second half of this year. He insisted it was “Apple’s call.”
AT&T Inc. has exclusive rights to the iPhone in the United States. The company has been silent about the reports on the new iPhone model. AT&T has run into trouble over the past year in major cities such as New York and San Francisco. The carrier said it is working on improving the quality of its network in those areas.
One of the reasons AT&T had so much trouble was because a small percentage of users would clog up the network with excessive wireless data demands. Mr. Seidenberg showed support for his wireless rival by saying that Verizon Wireless would be willing to “throttle,” or slow down the connection speed of excessive users and find a way to make them pay more for their service.
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