Cingular crews busy integrating service with one-time competitor

ATLANTA — Raymond Smith and Chuck Manley are burly phone company guys who once worked for competing providers in the distant suburbs of Atlanta, crossing paths just a single time as both serviced equipment at a shared cell tower.

They're colleagues now, employed by Cingular Wireless, a company with a mishmash of so many different network technologies that it will take another year to sort them out. Smith, formerly of AT&T Wireless, and Manley, who was already with Cingular, have delved into the guts of 20 or so cell sites, handling their small part of a nationwide process that is supposed to end with a better, more efficient network.

"We get along great," Manley said of his many hours spent with Smith. "We have to," he joked.

Last year, when Cingular bought AT&T Wireless for $41 billion, the newly enlarged Atlanta company jumped ahead of Verizon Wireless to become the nation's No. 1 cellphone company.

Staying there will be a challenge. Verizon has a highly regarded network. A recent consumer survey by J.D. Power & Associates rated T-Mobile and Verizon as the nation's best-liked carriers. Verizon also loses fewer customers than Cingular.

But Cingular, which is scheduled to release third-quarter financial results today, is still taking direct aim at this big rival and other major players, including Sprint Nextel. Cingular's current ads, under the theme "Raising the bar," highlight improvements in the company's network.

Making reality match marketing is what is going on now.

Bill Hogg, Cingular's vice president for enterprise program management, said merging two big companies has been an incredibly complex job. Cingular has dealt with several major goals, like evaluating the combined work force and cutting the equivalent of 11,000 full-time jobs. Cingular is still working on other issues, from billing systems to a host of changes in retail stores.

But the most complex and expensive job involves revamping Cingular's vast fabric of network equipment. To succeed, Cingular must improve service while also finding ways to simplify and cut costs, in part by shutting down cell sites that aren't needed.

The company disclosed Tuesday it expects to spend $620 million on network integration costs. By 2008, however, the company predicts the merger will lead to savings of $3.2 billion to $4.1 billion.

Last week, Smith and Manley, who are senior field engineers, worked at a site in Cobb County, at the end of a narrow lane that snakes behind the parsonage of Shallowford Free Will Baptist Church.

The tower holds equipment for several carriers and came to Cingular as an AT&T Wireless site. It bears antennas and equipment for an older technology called Time Division Multiple Access, or TDMA, plus a more advanced system called Global System for Mobile communications, or GSM.

Such systems are invisible to most phone users. But technology has a major effect on service and whether a customer stays with one carrier or shifts to another.

At this site, a wave of changes has been under way, even before the arrival of Smith and Manley on a gray, misty morning. A worker had already scaled the site's 120-foot-tall steel tower to install new antennas that peek above the surrounding pine trees. Other crew members worked in a compact, air-conditioned building at the base of the tower, taking out the TDMA devices and putting in a cabinet of GSM equipment to replace one that was already there.

Workers also installed a cabinet of equipment for yet another technology — known by the initials UMTS/HSDPA — to get ready for a new, faster level of service that will be rolled out soon in major markets.

The alphabet soup of cellphone lingo is second nature to Ed Reynolds, Cingular's president of network operations. Yet the rejiggering he oversees is still daunting.

Reynolds, who has worked in the wireless business for 16 years, carries a cellphone that uses the theme song of "Mission: Impossible" as its ring tone.

Reynolds said the company plans to pare 13 network technologies down to four. Cingular mulled a plan to revamp the system in one fell swoop before deciding it would be best to go with a gradual integration across the country, with Georgia among the first markets to be converted.

The process involves many steps, starting with decisions on which cell sites should stay, which should go and where new ones should be built.

Take an example of an interstate highway lined with equipment sites from the old Cingular and AT&T Wireless systems. Together, they should provide better coverage, simply by having more towers.

But much equipment needs to be switched or replaced, as at the site where Smith and Manley worked in Cobb. In areas where coverage overlaps — Cingular and AT&T Wireless equipment sometimes sits on the same tower, along with that of other carriers — the company can eliminate a slot.

This is where a merger saves network costs. Typically, Cingular uses sites owned by someone else, whether an individual or a big tower company such as Crown Castle International. The rent is usually $1,000 to $2,000 per month. There are expenses of another $600 to $1,000 to lease lines that run from the tower to a switching facility. Add in maintenance, and the average cell site can cost more than $3,000 a month.

Eventually, Cingular will weed out 7,600 unnecessary sites, with most of them — about 5,700 — being old AT&T Wireless sites.

The trick is not disrupting service. Ed Sullivan, who lives in Lawrenceville, Ga., had an old AT&T Wireless plan with an analog phone. When the network changeover started, the quality of his service plunged, he said.

Cingular urged him to switch to digital, because analog is so old. Irritated, he did — but with a phone from Sprint.

In Paulding County, however, Pam Kane is happy with her Cingular service, thanks to the completion of the company's integration work near her home. Before, Kane couldn't get calls, even on the porch.

"It's gotten to where I've got excellent reception in the house," she said. Now Kane might drop her landline.

The many risks of a merger often revolve around whether customers will stay happy through the process. Network snafus can drive people away. So can problems with bills or troubles switching from plan to plan, especially those migrating from old AT&T Wireless offerings to Cingular.

Cingular's customer turnover — or churn — is an important indicator of whether people are pleased. In the second quarter, Cingular's churn was 2.2 percent, far greater than Verizon's 1.33 percent.

Reynolds worries about service snags. As the transition continues, he knows customers could encounter quirky problems, such as in areas where service was fine and now has hiccups. It's supposed to be temporary.

Reynolds said he himself was annoyed to lose a call as he drove on Holcomb Bridge Road recently near a site where a crew was at work.

If the network changes were akin to fixing a road, a crew could work at night. But some jobs involve climbing tall towers. "It's hard to get people to climb towers at night. I wouldn't do it," Reynolds said. That means some jobs must be done during the day, when demand is highest.

Cingular hopes to finish the nationwide integration by the end of 2006, but challenges are bound to crop up. Hurricane Katrina already slowed things, as many workers shifted to Louisiana and Mississippi.

Max Weise, who follows the wireless industry for research and consulting firm Adventis, said Cingular suffered early difficulties after buying AT&T Wireless, including in customer service. That's been fixed, he said, but much work remains.

"The network piece is very challenging," Weise said. "It's a tough engineering challenge, and it's very local, market-by-market. Really, tower-by-tower."

On-the-ground employees like Smith and Manley understand the magnitude of the job. They get frequent briefings. Both of them, former rivals, now pursue a common goal of making the new company work.

"We're working very hard on it," Manley said. "We all want to see that we accomplish this."

Scott Leith writes for The Atlanta Journal-Constitution.