AT&T back on the mobile road

Virtual network deal with Sprint

AT&T has done a deal to get back into the mobile phone business by piggy-backing on Sprint's network. The five-year agreement will mark AT&T's first foray into mobiles since it spun off AT&T Wireless in 2001. Financial terms were not revealed. It will offer mobile services and branded handsets.

AT&T Wireless is being bought by Cingular, and when it is, the brand reverts to AT&T. The deal should close later this year. The agreement means AT&T can bundle and cross sell services to its 30m customers, and offset declining revenues from its fixed line business.

AT&T said the Mobile Virtual Network Operator model would work well in the US. It said MVNO meant it could enter the market without incurring huge costs. Although it is a competitive market AT&T believes increasing demand for voice and data services and the recent introduction of number portability will help it succeed.

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