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Qwest Ditches Sprint for Verizon

When was the last time that many big carriers appeared in one headline?

Qwest Communications International Inc. (NYSE: Q) and Verizon Communications Inc. (NYSE: VZ) announced late today that Qwest will market and sell Verizon Wireless services to its customers beginning this summer. Financial terms of the five-year deal were not disclosed. (See Qwest, Verizon Partner.)

Further, Qwest confirmed to Light Reading that it will discontinue its wireless partnership with Sprint Corp. (NYSE: S) come first quarter 2009, when that deal expires, focusing solely on its new agreement with Verizon.

The new deal with Verizon has all the terms that CEO Ed Mueller was looking for when he said back in February that he was not satisfied with the Sprint arrangement. This includes being able to sell more wireless data to Qwest customers. (See Qwest Not Satisfied With Sprint and Qwest Wants More Wireless.)

“It’s going to allow us to deliver broadband to wherever our customers want,” says a Qwest spokesperson.

Qwest also emphasized that the Verizon deal would allow it to sell more wireless plans to business and government customers, not just residential ones.

While financial terms have not been disclosed, this deal more closely resembles the partnership Qwest has in place with DirecTV Group Inc. (NYSE: DTV). With Sprint, Qwest was simply buying and reselling Sprint contracts as a wholesaler. But with Verizon, it will act as a mobile virtual network operator (MVNO) and actually market and sell the service as if it were its own.

Qwest’s announcement comes just ahead of its earnings release tomorrow morning, so more information could become available then.

— Raymond McConville, Reporter, Light Reading

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