Subject: [NEXTEL-1] PR Firm Takes Heat for NextWave/Cingular Blunder

From: [email-masked]
Date: Fri, 01 Aug 2003 14:30:09 -0400

PR Firm Takes Heat for NextWave/Cingular Blunder
BY SUE MAREK
AUGUST 1, 2003

After weeks of speculation and news reports quoting unnamed sources saying that
Cingular Wireless was in negotiations to purchase spectrum licenses from bankrupt
NextWave Telecom, NextWave finally came clean early this morning and announced
that the two companies did indeed have an agreement.  According to the NextWave
announcement, Cingular agreed to purchase NextWave licenses in 34 markets covering
approximately 83 million POPs for $1.4 billion. But apparently the deal wasn't
firm and now NextWave's public relations firm is taking the heat for the blunder.
In a press statement, Hill & Knowlton blamed "a clerical error" for the renegade
press release and said that NextWave had no role in the distribution of the
release.

NextWave officials say the two companies are still in discussions but that there
is no final agreement.Nevertheless, the false announcement caused Cingular to
issue a terse statement saying that while it was in negotiations with NextWave to
possibly purchase certain spectrum licenses, "a definitive agreement has not been
released and there can be no assurance that an agreement will be reached, or, if
reached, that any transaction will be consummated."

In a research note, Raymond James analyst Ric Prentiss speculated that price may
be one factor holding up the negotiations.  In addition, he noted that NextWave's
revoked release said that the licenses were for spectrum in markets where Cingular
already offers service.  According to Prentiss, this indicates that Cingular needs
extra spectrum for its GSM overbuild and is not necessarily looking to purchase
spectrum in markets where it doesn't already offer service.

In addition, if Cingular does indeed end up paying $1.4 billion for licenses that
cover 83 million POPs, it equates to about $1.69 per MHz POP, which, according to
Prentiss, is a higher price than expected.

http://www.wirelessweek.com/index.asp?layout=document&doc_id=123863&verticalID=34&vertical=Business+and+Finance&industry=

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