Merger Strengthens U.S. GSM

As the ink was drying on the merger agreement between VoiceStream and Omnipoint, the questions about which purchase would be next already were surfacing within industry circles. Would Powertel or Aerial be next? According to Bob Egan of the Gartner Group, this is stage one in the inevitable merging of all four GSM carriers.

"I've been saying for six months that this would happen," Egan said. "Now, Powertel is next, then Aerial."

What the VoiceStream Omni-point merging does for U.S. GSM network presence is huge, according to Egan. GSM currently struggles to reach the business market because of its small regional reach and incomplete network. However, future couplings will get the new GSM network on a par with the likes of AT&T and Nextel, he said.

While the next 12 months likely will see more GSM property mergers, Egan predicted that soon the consolidations will become more international in nature and scope, a trend initiated by AirTouch and Vodafone.

"No one should take for granted the power of GSM in terms of quality," Egan said. "No one has been able to replicate it."

With VoiceStream spun off from Western Wireless and occupied with the merger with Omnipoint, some analysts have suggested that Western Wireless becomes a desirable takeover target. Some have said that AT&T Wireless is eyeing the company because of its Western U.S. coverage. However, neither AT&T nor Western Wireless is talking at this point.