Cellular merger won't let users off contract hook
Subscribers hoping that Cingular's planned purchase of its carrier rival will let them out of long-term AT&T Wireless service contracts are out of luck.
Cingular doesn't plan to cancel or otherwise change any AT&T Wireless subscriber agreements, if its $41 billion acquisition goes through, an AT&T Wireless representative said Friday.
"Everything continues as is," the representative said. "The only thing that will change is the name on the bill."
Cingular, jointly owned by SBC Communications and BellSouth, beat out Europe-based Vodafone in the bidding for its cellular carrier rival and announced the acquisition deal on Feb. 17.
Most of AT&T Wireless's 22 million subscribers have signed one- or two-year contracts. The representative didn't know how many will still be active at the end of the year, when the planned merger would become final.
More than 95 percent of U.S. cell phone subscribers have signed multiple-year service contracts. That makes the question of how to deal with those agreements an inevitable concern in any cellular-carrier takeover.
Many DSL (digital subscriber line) providers have introduced year-long contracts as a requirement for cheaper subscriptions. For example, SBC Communications customers can get a rate of $29.95 a month for DSL service, if they sign up for a year.
Cable companies have also offered long-term contracts balanced by cheaper monthly fees for video and broadband services.