Alltel

Alltel was an American telecommunications company active in landline, wireless, and related communications services. Its modern corporate history began in 1983, when Allied Telephone Company merged with Mid-Continent Telephone Corporation. Allied Telephone had originated in Arkansas as a supplier and installer of telephone infrastructure, while Mid-Continent had roots in a Minnesota theater business that later entered telecommunications. The merger created a regional communications company that combined wireline operations with an expanding wireless business. Alltel launched its first wireless system in Charlotte, North Carolina, in 1985 and gradually expanded through network construction, spectrum holdings, roaming arrangements, and acquisitions. The company concentrated particularly on small and medium-sized cities and rural markets, where it developed a substantial regional presence. At its peak, Alltel operated cellular networks in parts of 34 states and served approximately 13 million wireless subscribers. Roaming arrangements with Verizon Wireless, Sprint, and other CDMA operators enabled Alltel customers to receive broader nationwide service than the company’s directly operated footprint alone would have provided. The Alltel Wireless consumer brand became increasingly central to the company. Its offers included postpaid voice and messaging plans, mobile data, prepaid service, wireless Internet, location-based family services, and value propositions such as My Circle, which provided unlimited calling to selected numbers. The company used CDMA-based networks, principally in the 850 MHz cellular band, and supported handsets from manufacturers including Motorola, LG, Nokia, Samsung, HTC, BlackBerry, Palm, and Pantech. Its marketing was notable for a long-running series of humorous advertisements featuring spokesman Chad and fictionalized or look-alike representatives of rival carriers. In December 2005, Alltel announced a plan to become a wireless-focused company. Its wireline operations were combined with Valor Telecom and began operating as Windstream Communications in 2006. This separation left Alltel concentrated on wireless communications and made the business a more direct strategic fit for a larger national mobile operator. In 2007, Alltel agreed to be acquired by TPG Capital and GS Capital Partners in a transaction reported at approximately $27.5 billion in cash, including assumed debt according to contemporaneous transaction descriptions. In June 2008, Verizon Wireless announced an agreement to acquire most of Alltel Wireless. The transaction was valued at approximately $28.1 billion and required Federal Communications Commission approval. To address competition concerns, Verizon divested 105 Alltel markets. AT&T acquired 79 of those properties in 2009, while Atlantic Tele-Network acquired the remaining 26 markets in 2010. The latter markets continued to use the Alltel name under Allied Wireless, an Atlantic Tele-Network subsidiary, and served approximately 800,000 customers. AT&T announced in 2013 that it would acquire the remaining Alltel operations from Atlantic Tele-Network for $780 million in cash. Customer migration to AT&T’s network was completed in February 2015, and AT&T dissolved Alltel Wireless in early 2016. Alltel therefore survives primarily as a historical telecommunications brand rather than as an independent operating company.

Alltel’s background reaches back to Allied Telephone Company, founded in Arkansas in 1943 by Charles Miller and Hugh Willbourn Jr. The business initially specialized in telephone poles, cabling, and equipment and later operated a retail storefront in Little Rock. Mid-Continent Telephone Corporation, the other predecessor, began in Minnesota in 1931 as a theater company founded by Eddie Ruben and Joe L. Floyd before moving into telecommunications. The modern Alltel Corporation was created in 1983 through the merger of Allied Telephone and Mid-Continent Telephone. Initially grounded in regional wireline communications, the company entered wireless service during the next phase of its development. In 1985 it launched its first wireless system in Charlotte, North Carolina. Wireless network construction and expansion through acquisitions gradually transformed Alltel into a major regional mobile operator. In 1993 it opened its first wireless retail store, and in 1997 it combined its wireless and wireline businesses into one organization. Alltel’s wireless operations were particularly important in smaller cities and rural areas. At its peak, company-owned networks covered portions of 34 states, while roaming agreements with larger and competing CDMA carriers extended customer access across the United States. The company’s network used analog and CDMA technologies, with substantial deployment of 1xEV-DO mobile data. Alltel also developed consumer services such as My Circle, U Prepaid, Family Finder, Voice2TXT, PhotoCopter, and Wi-Fi access. In 2005 Alltel announced that it would become wireless-only. Its wireline assets were combined with Valor Telecom, producing Windstream Communications, which began operations in 2006. Alltel subsequently became a more focused wireless company. In 2007 it agreed to a private-equity acquisition by TPG Capital and GS Capital Partners. Verizon Wireless announced the acquisition of most of Alltel in 2008, and the transaction received regulatory approval subject to the sale of 105 markets. AT&T purchased 79 of those markets, while Atlantic Tele-Network purchased 26 and continued operating them as Allied Wireless under the Alltel brand. AT&T later agreed to acquire the residual Alltel business from Atlantic Tele-Network. The transaction was announced in 2013, customer migration was completed in February 2015, and AT&T dissolved Alltel Wireless in early 2016. The company’s history illustrates the consolidation of regional American telephone operators into larger national wireless networks and the gradual disappearance of an independent Alltel operating business.

1. 2016Alltel Wireless is dissolved

   AT&T dissolved the remaining Alltel Wireless operation after completing the network transition.

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2. 2015Customer migration ends

   The remaining Alltel customers were migrated to AT&T’s network.

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3. 2013AT&T announces acquisition of remaining Alltel business

   AT&T announced a $780 million cash acquisition of the remaining Alltel operations from Atlantic Tele-Network.

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4. 2010Residual markets continue under Allied Wireless

   Atlantic Tele-Network acquired 26 remaining divested markets and operated them under the Alltel name through Allied Wireless.

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5. 2009Divested properties move to AT&T

   AT&T announced the acquisition of 79 markets divested in connection with Verizon’s Alltel transaction.

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6. 2008Verizon announces acquisition

   Verizon Wireless announced its agreement to acquire most of Alltel Wireless for an estimated $28.1 billion.

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7. 2007Private-equity acquisition announced

   TPG Capital and GS Capital Partners agreed to acquire Alltel in a cash transaction reported at approximately $27.5 billion.

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8. 2006Wireline business becomes Windstream

   Alltel’s wireline operations merged with Valor Telecom and began operating as Windstream Communications.

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9. 1997Wireless and wireline operations are combined

   Alltel brought its wireless and wireline businesses together within a single organization.

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10. 1993First wireless retail store opens

    Alltel opened its first wireless retail store as its mobile business developed.

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11. 1985First Alltel wireless system launches

    Alltel launched its first wireless system in Charlotte, North Carolina.

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12. 1983Alltel Corporation is formed

    Allied Telephone Company merged with Mid-Continent Telephone Corporation to create Alltel Corporation.

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13. 1943Allied Telephone Company is founded

    Charles Miller and Hugh Willbourn Jr. founded the Arkansas business that became one of Alltel’s principal predecessor companies.

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A regional and rural-focused American telecommunications operator that combined wireless service, legacy wireline operations, and nationwide roaming access.

• Alltel WirelessWireless telecommunications1985

  Alltel’s principal consumer-facing wireless business provided mobile voice, messaging, and data services in regional markets across the United States. Its directly operated footprint was supplemented by roaming agreements with other CDMA carriers. Most of the business was absorbed by Verizon Wireless, while divested markets later operated under the Alltel name through Allied Wireless before being acquired by AT&T.

• My CircleMobile calling plan feature2006

  My Circle allowed eligible customers to select a group of telephone numbers for unlimited calling. The number of included contacts varied by plan, and later anniversary benefits added bonus numbers. The feature became one of Alltel’s most recognizable commercial propositions and was later succeeded for migrated customers by Verizon Wireless’s Friends & Family offering.

• U PrepaidPrepaid wireless service2006

  U Prepaid was an Alltel prepaid offering that allowed customers to customize plans with text messaging and unlimited calls to a selected number. It could use roaming access on compatible CDMA networks and was positioned against other prepaid brands such as Boost Mobile, Virgin Mobile, and AT&T GoPhone.

• Alltel Family FinderLocation-based family service

  Family Finder used GPS-enabled phones and software to let plan users request or schedule location updates for family members. Results could be displayed on a handset or computer, with notifications and map-based location checks available as part of the service.

• Alltel Wi-FiWi-Fi and mobile Internet access2007

  Alltel Wi-Fi provided laptop access to participating Wi-Fi hotspots in North and South America. The company also marketed bundled wireless Internet and Wi-Fi access so customers could move between cellular and hotspot connectivity.

• Voice2TXTVoice-mail transcription2007

  Voice2TXT converted incoming voicemail messages into text messages for delivery to SMS-capable Alltel phones, giving customers a text-based alternative to calling voicemail.

• PhotoCopterPhoto synchronization service2008

  PhotoCopter automatically transferred pictures taken with compatible camera phones to customers’ computers and selected online photo albums.

• Alltel Wi-Fi mobile hotspotMobile hotspot service2011

  The mobile hotspot service allowed customers to connect multiple devices to the Internet through an Alltel wireless connection, with support for as many as five simultaneous devices according to the referenced description.

• Wireline servicesFixed telecommunications

  Alltel’s historical wireline portfolio included regional telephone and related communications access services. These operations were separated from Alltel and combined with Valor Telecom to form Windstream Communications in 2006.

• 2004My Circle look-alike advertising campaign

  United States

  Working with Campbell-Ewald, Alltel promoted My Circle through humorous television advertising featuring spokesman Chad and fictionalized look-alikes of representatives associated with rival wireless carriers. The campaign used legal disclaimers to distinguish the characters from the actual competitors and later expanded into digital properties, retail scenarios, holiday spots, and recurring “Sales Guys” characters.

  Outcome. The campaign became a prominent part of Alltel’s brand identity and helped frame My Circle as a distinctive alternative to competing calling plans. Rival carriers subsequently introduced comparable circle or favorite-number propositions.

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• 2013Sell residual Alltel operations to AT&TM&A

  Atlantic Tele-Network continued operating 26 divested markets under the Alltel name after Verizon’s acquisition, but the assets were later targeted by AT&T for network consolidation.

  What changed. AT&T announced the acquisition of the remaining Alltel business from Atlantic Tele-Network for $780 million in cash.

  Aftermath. AT&T migrated the remaining customers to its network by February 2015 and dissolved Alltel Wireless in early 2016.

  Purchase price. $780 million in cash (2013 announcement)

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• 2008Sell most wireless operations to Verizon WirelessM&A

  Verizon sought to expand its wireless network, spectrum position, and subscriber base through Alltel’s regional operations.

  What changed. Alltel agreed to sell most of Alltel Wireless and related assets to Verizon Wireless.

  Aftermath. Regulatory approval required 105 markets to be divested. Most remaining Alltel operations were integrated into Verizon Wireless, while divested markets went to AT&T and Atlantic Tele-Network.

  Transaction value. Approximately $28.1 billion (2008 announcement)

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• 2007Accept private-equity acquisitionM&A

  Alltel’s regional wireless footprint and subscriber base attracted financial buyers as the U.S. telecommunications sector consolidated.

  What changed. The company agreed to be acquired by TPG Capital and GS Capital Partners in a cash transaction reported at $71.50 per share and approximately $27.5 billion.

  Aftermath. Alltel became privately held before its wireless operations were sold to Verizon Wireless.

  Transaction value. Approximately $27.5 billion (2007 announcement)

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• 2006Separate the wireline businessStrategy

  Alltel sought to focus its corporate resources on the faster-growing wireless business while preserving the value of its established wireline operations.

  What changed. It combined the wireline business with Valor Telecom and created Windstream Communications as a separate operating company.

  Aftermath. Alltel became primarily a wireless operator, while Windstream assumed the former regional wireline activities.

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• 2015Alltel customer migration to AT&T network completed

  AT&T completed the migration of the remaining Alltel customers to its network, ending the operational transition of the residual Alltel business.

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• 2013AT&T announces purchase of remaining Alltel operations

  AT&T announced a $780 million cash acquisition of the remaining Alltel operations from Atlantic Tele-Network.

  M&A
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• 2010Atlantic Tele-Network acquires remaining divested Alltel markets

  Atlantic Tele-Network acquired 26 remaining divested markets, including network assets, licenses, and approximately 800,000 customers, and operated them through Allied Wireless under the Alltel name.

  M&A
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• 2009AT&T agrees to acquire 79 divested Alltel properties

  AT&T announced that it would acquire 79 divested Alltel wireless properties, including licenses, network assets, and approximately 1.5 million subscribers.

  M&A
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• 2008Verizon Wireless announces acquisition of most of Alltel Wireless

  Verizon Wireless announced an agreement to acquire the majority of Alltel Wireless and related assets in a transaction valued at approximately $28.1 billion.

  M&A
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• 2008FCC approves Verizon transaction with required market divestitures

  Federal approval of Verizon’s Alltel acquisition required the divestiture of 105 Alltel markets to address competition concerns.

  M&ARegulation
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• 2007Alltel agrees to sale to TPG Capital and GS Capital Partners

  Alltel announced an agreement to be acquired by two private-equity firms in a cash transaction reported at approximately $27.5 billion.

  M&A
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• 2006Alltel completes wireline separation and Windstream begins operations

  The merger and spin-off process for Alltel’s wireline operations concluded, with Windstream beginning operations as a separate communications company.

  M&AOther
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• 2005Alltel announces separation of wireline operations

  Alltel announced that it would become a wireless-focused company while combining its wireline operations with Valor Telecom in a new business that became Windstream Communications.

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1. Alltel
2. Windstream Communications