Questions and answers on how the Cingular-AT&T Wireless deal may affect cell phone users

<p>How the proposed merger between Cingular Wireless and AT&T Wireless may affect cellular prices and services for the companies 46 million customers.</p><p>Q: By eliminating one cell phone company, will the deal stop the price wars for wireless calling plans or even raise the cost of wireless calls?</p><p>Although consumer advocates are worried the loss of one national provider will hurt competition, market pressures are expected to remain fierce in the U.S. cell phone industry.</p><p>Most of the nations 100 biggest markets would still be served by up to five national wireless companies, and possibly more in areas where there are regional and local providers. By contrast, in many other countries, there are often only three major wireless companies providing service in any given market.</p><p>In addition, under the new federal rules allowing cell phone customers to switch service providers without losing their phone numbers, analysts say wireless companies will be hesitant to start raising prices as they compete for subscribers.</p><p>Q: Will cell phone coverage improve with the combination of the two companies wireless networks?</p><p>In terms of national coverage, the deal will fill in some gaping holes for Cingular, which doesnt own licenses to use the wireless spectrum in 13 major markets including New York City, Denver, Phoenix and Pittsburgh. As a result, Cingular customers may face roaming fees less often when they use their phones in some of those markets.</p><p>The benefits are less certain on a local level in the markets where the companies already provide service.</p><p>By combining their spectrum and capacity, the companies may be able to cut down on dropped calls and network busy signals in high-volume calling areas. Martin Dunsby, a consultant with inCode Telecom Group, said the combined resources of the merged company could reduce the frequency of dropped and blocked calls to between 1 percent and 3 percent vs. an industry average of 2 percent to 4 percent.</p><p>But the deal may not fill in all the dead spots where customers cant get reception. While in some areas Cingular or AT&T Wireless may have a wireless transmitter where the other doesnt, coverage gaps often relate to a shortage of available locations to place a tower or an antenna because the local community considers the equipment an eyesore.</p><p>As a result, rival cellular companies often place their transmitters on the same towers and buildings, providing coverage in roughly the same area.</p><p>This `not in my backyard syndrome will perpetuate holes regardless of these mergers, said Shiv Bakhshi, an industry analyst for the research firm IDC.</p><p>Q: Will existing cell phones from AT&T Wireless and Cingular still work after the merger, or will one of the companies subscribers need to get new handsets after the merger?</p><p>The companies offered no immediate answers on potential compatibility issues, though analysts suggested that Cingular would need to develop a network patch and revise the software and encryption on AT&T Wireless phones.</p><p>While both companies use the same cellular technologies, known as TDMA and GSM, the handsets are not automatically compatible with any wireless network using those standards because cell phone companies often build in security features to ensure that only their customers use their service.</p><p>To ease the transition, Cingular may be able to transmit any necessary software upgrades over the air to AT&T Wireless cell phones. Otherwise, customers would need to come down to company stores for a fix.</p><p>Q: If the combined company is to be named Cingular Wireless, does that mean the AT&T brand name will no longer exist?</p><p>No. The name will still be used by AT&T Corp., the long distance telephone company which spun off AT&T Wireless as an independent company in 2001.</p><p>As part of that arrangement, AT&T Wireless was given the right to use the AT&T brand, but did not own any rights to the name. The right to use the name was also subject to revision if AT&T Wireless were to be acquired by another company.</p>

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