(Host) State officials are concerned that a planned sale of Unicel could limit choice for cell phone service.
Attorney General William Sorrell says his office will look at the deal from an anti-trust perspective.
And the state’s consumer advocate says he’s concerned that a lack of competition could hurt customers.
VPR’s John Dillon reports.
(Dillon) Verizon Wireless wants to buy Unicel’s operations in Vermont and 14 other states. The two companies are far and away the dominant cell phone carriers in Vermont.
(O’Brien) "I would describe my view of this right now as worried."
(Dillon) Public Service Commissioner David O’Brien runs the state department that represents consumers in utility issues.
(OBrien) "I’m worried because this would essentially combine the two largest players by a healthy margin into one company. That would not totally eliminate but severely reduce the amount of competition in Vermont. And we like customers to have choice and options."
(Dillon) By national standards, Minnesota-based Rural Cellular Corporation is a tiny player. But Rural Cellular, which operates the Unicel brand has carved out a niche in small markets like Vermont, upstate New York and Maine. Verizon Wireless wants to buy the company for about $2.6 billion.
Verizon and Unicel have different coverage areas. In some parts of the state, Unicel’s service is more complete, and in other areas, you can only get a Verizon signal.
So, could the sale improve service by combining the two companies’ cell towers and service areas?
Maybe O’Brien says.
(O’Brien) "I guess because the two footprints may be in some respects complementary, if you become a Verizon wireless customer as a Unicel customer, maybe there are some instances where you will pick up coverage."
(Dillon) But there are technological hurdles to be cleared first. The two companies use a different system to send and receive calls. So combining the two systems will take time.
And Verizon says it wants to move Unicel customers to its network. For Unicel users, that will mean buying a new phone.
The cell companies fall under federal regulation. O’Brien says the state now has to decide whether to get involved in the federal review.
Meanwhile, Attorney General William Sorrell says he wants to study the sale for potential anti-trust implications.
(Sorrell) "It’s really similar to a situation a few years ago when the two largest satellite dish providers were going to merge. It just so happens that Vermont on a per capita basis has the most number of satellite dish owners in the country because we’re so rural. So when we looked at that proposed merger. We didn’t think that was going to benefit Vermont consumers. So we opposed that and it ultimately didn’t happen."
(Dillon) A Verizon Wireless spokeswoman said she didn’t want to comment because the sale is in its very early stages.
For VPR News, I’m John Dillon in Montpelier.