McCaw Cellular AT&T Wireless began in 1987 as
McCaw Cellular Communications, a cellular telephone pioneer in the
United States. Savvy licensing of cellular spectrum in the early 1980s put McCaw Cellular in an extremely strong position, quickly outpacing the growth of the "Baby Bells" in the emerging market. The company purchased
MCI Communications's mobile businesses in 1986, followed by
LIN Broadcasting in 1989, giving them widespread access in all of the major US markets. Partnering with AT&T as a technology provider, McCaw introduced their "Cellular One" service in 1990, the first truly national cellular system. AT&T purchased 33% of the company in 1992 and arranged a merger in 1994 that made
Craig McCaw one of AT&T's largest shareholders. In 2002, the company was spun off from AT&T to become AT&T Wireless Services. In 1966,
J. Elroy McCaw sold one of his
cable television holdings in Centralia, Washington to his three sons, including Craig, who was 16 years old at the time. Craig took an increasingly central role in the development of McCaw Communications, and by the early 1980s had grown the company from 2,000 subscribers to about $5 million in annual revenue. In 1981 McCaw came across an AT&T document about the future of cellular telephony, which predicted that by the start of the 21st century there would be 900,000 cellular subscribers in the United States. Intrigued, McCaw found that the licenses for
cellular spectrum were being sold at $4.50 per "pop", meaning he could build a base for future subscribers for very low cost. By 1983, McCaw Communications had purchased licenses in six of the 30 largest US markets. McCaw then succeeded in using the licenses and
collateral, based on the AT&T projections, using that collateral to take out loans and buy more licenses, and eventually buying billions of dollars of spectrum. In 1987 he sold the cable business for $755 million and used this new capital to buy even more cellular licenses. In 1989 the company outbid
BellSouth for control of
LIN Broadcasting, which owned licenses in
Houston,
Dallas,
Los Angeles, and
New York, paying $3.5 billion, a price that represented $350 per license. As a result of the merger, Craig McCaw became one of AT&T's largest shareholders, but he refused to sit on the Board of Directors because he couldn't stand long meetings. AT&T Wireless's decline climaxed in 2003 with the FCC mandating the allowance of porting numbers to other carriers. AT&T Wireless experienced a mass exodus of many customers who were fed up with years of degrading service and poor coverage. By the end of 2003, AT&T Wireless faced a public relations nightmare when a new system for adding subscribers and porting numbers in/out was implemented and botched. Realizing that it faced an impossible situation, AT&T Wireless Services, Inc began accepting bids in early 2004 to be acquired. As of January 1, 2004, the largest single shareholder of AT&T Wireless was
Japan's
NTT DoCoMo, which was one of the first to place a bid to buy the company. In the middle of 2004 much of the Caribbean operations and Bermuda were agreed to be sold to
Digicel Group.
Acquisition by Cingular On February 13, 2004, AT&T Wireless accepted bids for the acquisition of the wireless company. The two top bidders were
British carrier
Vodafone and American competitor
Cingular. Cingular was owned by two
Baby Bells; 40% by
BellSouth and 60% by SBC Communications. Vodafone owned 45% of
Verizon Wireless and had it succeeded in the bid, their share of Verizon Wireless would then have been sold to parent company
Verizon Communications. Cingular emerged victorious February 17 by agreeing to pay more than $41 billion, more than twice the company's recent trading value, to acquire AT&T Wireless. Some analysts have said that although Vodafone, the world's largest mobile operator, was unsuccessful in acquiring the company, it was nonetheless successful in forcing a competitor to overpay for the acquisition of AT&T Wireless. The sale received US government approval and closed on October 26. Companies that originally comprised Cingular from its inception, such as
BellSouth Mobility, were absorbed into the AT&T Wireless Services corporate structure. The AT&T Wireless brand was retired by Cingular on April 26, 2005, six months after the close of the merger. This was per a pre-spinoff agreement with AT&T Corp. that stated that if AT&T Wireless was to be bought by a competitor, the rights to the name AT&T Wireless and the use of the AT&T name in wireless phone service would revert to AT&T Corp. AT&T Wireless's prepaid services, Go Phone, was adopted by Cingular Wireless after the merger closed, and was used by the current AT&T Mobility until it was rebranded as AT&T PREPAID in 2017. ==Partnerships==