What You Need to Know About the Wireless Market...

Over the past decade, the wireless sector has grown from near infancy to become a 'must invest' space for the diversifying trader.

It's no secret that wireless providers have been afforded a great position of power, with clientele ranging from pre-pubescent middle schoolers, all the way to established corporations.  Walk into any office, you'll invariably see a BlackBerry on each desk. Walk into Chili's on a Friday night and you'll be hard-pressed to find a teenage girl with their phone in pocket, each diligently texting away to peers unseen. As of recent, these same providers have expanded their repertoire to include not only mobile phones, but also wireless internet service for laptops, netbooks, and tablets, as well as landline offerings.

Within the sector, there are four main competitors: Sprint/Nextel (NYSE: S), T-Mobile (FWB: DTE), AT&T (NYSE: T), and Verizon (NYSE/NASDAQ: VZ). 

It is important to first recognize that T-Mobile's primary market is, in fact, not the United States. T-Mobile USA was the result of Deutsche Telekom's (parent company of T-Mobile and Europe's largest telecommunications provider) acquisition of VoiceStream, as a means of humbly having a presence to America. 

This narrows the competition to three primary carriers. In terms of subscribers, Verizon barely tops AT&T at 93.2 million versus AT&T's 92.8 million. (October '10) Both companies maintain nearly double the subscribers of Sprint, which currently amounts to about 48.9 million. (January '10)

Despite Sprint's attractive offerings, one of which being a completely unlimited plan running $99/month which provides you with unlimited data, calling, texts, and more, the company's coverage could never match that of its larger adversaries. Additionally, Sprint fails to offer features, e.g. mobile television, that its competitors have pioneered in recent years. This consistently renders the company one step behind, which is why many analysts maintain S on their 'hold' list.

AT&T is a company that found its roots in landline telecommunications decades ago. It continues to build upon this early success by adding additional mass-media branches to its portfolio, which include television, broadband internet, and mobile telephone, that came with the indirect merger of Cingular Wireless and AT&T. Some analysts consider this massive (largest non-banking and non-oil based company in the world) company's mobile platform to be in jeopardy with the near-certain release of a CDMA iPhone next Tuesday. This release comes on the back of many customers unsatisfied with AT&T's lack of widespread 3G coverage, and poor call quality. Because of the gravity AT&T's wireless department has on the success its holder, many analysts are slightly bearish on T.

However, many are bullish when it comes to Verizon, especially when considering a long-term position. With the inclusion of both iPhone and iPad, as well as the strong development in 4G coverage, now seems like a promising time to be long in VZ. Look for a very volatile buying period during the next week or so, which will resolve within the coming month. Also look for the bearish movement in price to continue from last week's end until late Monday or early Tuesday.

It's an exciting time to be involved with the mobile telecom sector, so stay tuned for the most up-to-date VZ information!

Upcoming Post...

Now that we've taken care of the basics, we'll have one of the Verizon Wise Guys do a breakdown of Verizon's stock later today. Stay tuned!

Verizon vs. The Competition: Why We Think VZ is the Best

At first glance it may seem like we're sucking up to Verizon, but we do have our reasons to think Verizon Wireless is the best. Let us count the ways...

1. Diverse services & products

-Any savvy businessperson knows its best to diversify. Verizon has certainly adhered to this phrase when diversifying its services and products. We all know about their cell phone service, but they also provide wireless accessory service (i.e. The holy grail, otherwise known as the iPad), cable TV, internet, and landline phone service.

2. Coverage

-Yadda yadda yadda coverage map is unbeatable. We hear it all the time in everyone's ads, but it appears that Verizon's really IS unbeatable. Though we have our sympathy for Alaska and Hawaii, the rest of America looks dandy. 

3. Customer Service

-We hate to knock off another site, but CNET rounds it up best in this article. The headline reads: "Verizon Wireless ranks No. 1 in customer service"

Anyone have anything to add? Anyone disagree? Comments welcome!

Who Are We?

The Verizon Wise Guys, who are we exactly? We're four like-minded teens who had a few paychecks burning a hole in our pockets from several summer jobs. Each of us decided to invest in a different wireless provider, and found after about 6 months that Verizon was the way to go (In retrospect it was a great experiment and we wish we had blogged it!). Anyway, enter: Verizon Wise. We found that knowing when to toss in a few extra dollars really boosted our dividend, and we'd like to help other shareholders like ourselves make the most out of the investments without the corporate spin! Now lets get down to business...