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AT&T, Cingular Merger To Shake Up Distribution

2/19/2004 12:56:00 PM Eastern

Atlanta — The planned merger between AT&T Wireless and Cingular will shake up distribution channels.

With the two carriers’ footprints overlapping in almost all of the top 100 markets, the combined entity will close an undetermined number of AT&T-branded or Cingular-branded stores, Yankee Group analyst Adam Guy predicts. Major retailers could also lose a carrier partner as the combined entity rationalizes its distribution strategy.

AT&T Wireless is sold in such major chains as 7-Eleven, Wal-Mart, Toys R Us and Best Buy, which also sells Cingular-branded service.

The two carriers’ presence is major retail chains 'is roughly equivalent,' Guy said. The two diverge when it comes to carrier-branded stores, however. AT&T sells through more than 1,100 owned-and-operated AT&T Wireless stores. Compared to AT$T, Cingular relies more heavily on Cingular-branded stores that are franchised to individual owner-operators, Guy said.