What Does Verizon’s Latest Acquisition Mean for NASCAR?
The latest in the business world is that Verizon Wireless is set to acquire Alltel in a deal worth approximately $27 billion - $22 billion of which is mostly existing debt owned by the Alltel Corp. While the deal has yet to be finalized, this could have a significant side-effect on the NASCAR world as we know it.
With all of the wireless provider mergers and acquisitions that have taken place over the past few years, we’ve seen quite a bit of shakeup in sponsorship in NASCAR. We’ve the hood of Jeff Burton’s no. 31 car go from Cingular to AT&T, and the brand name of stock car racing’s number one series changed from Nextel to the Sprint Cup Series virtually overnight. Once that happened, Sprint immediately targeted AT&T’s sponsorship status in the sport, and as a result, the two companies finally came to an “agreement”, and AT&T is on their way out.
Now, why Alltel was never targeted by Sprint is beyond me. Perhaps Alltel’s status in the wireless market was less threatening to Sprint, maybe there were some legal loopholes, or heck, maybe they just hadn’t gotten around to it yet. Whatever it is, many people feel that with the latest acquisition taking place, sponsorship for the no. 12 Dodge of Ryan Newman over at Penske Racing could soon be in jeopardy.
I don’t know the exact details of Alltel’s current sponsorship agreement with Newman and the Penske organization, but these sponsors typically sign a contract with the team that runs as long as the driver’s current contract. If that’s the case here, then Newman’s contract with Penske is up at the end of the year, and they would have to re-negotiate for 2009 anyway, meaning that the remainder of this season is all they would truly have to worry about. That said, when these acquisitions take place, the old company will, in many cases, keep their name out there for a certain period of time before an official name change takes place, as was the case with the AT&T and Cingular deal.
Verizon, on the other hand, has really been trying to stretch their name across various markets in the past couple of years, perhaps most notably with their purchase to the naming rights of various sports and entertainment venues throughout America. They have also sponsored Nationwide cars in the past, and would most likely be interested in engaging a campaign in the Cup Series if able.
It’s all pure speculation as to what we can expect to see from Verizon - or, Alltel, for that matter - in NASCAR throughout this season, let alone in 2009. But, in the meantime, I encourage you all to read Another Wireless Sponsor Battle on the Horizon for Sprint and Verizon Agrees to Acquire Alltel, and you can all draw your own conclusions just as we have.
*Credit photos to Newscom.
Tags: Jeff Burton, NASCAR, Penske Racing, ryan newman, Sprint Cup SeriesRelated Stories
POSTED IN: NASCAR
5 opinions for What Does Verizon’s Latest Acquisition Mean for NASCAR?
RevJim
Jun 6, 2008 at 4:59 pm
Alltell was grandfathered in as a Winston Cup sponsor when Nextel took over the series sponsorship, while the sponsorship that is now AT&T was grandfathered in as “Cingular.” AT&T bought our Cingular, and the sponorship switched over to them, which was unacceptable to NASCAR and Nextel. Under those rules, Verizon will not be able to sponsor a car, but they would if they kept the Alltell name.
Tim Zaegel
Jun 6, 2008 at 5:41 pm
Interesting. Thanks for the feedback (and, for educating me). Do you happen to know how long Alltel’s current contract runs with Penske?
Ryan Newman's #1
Jun 6, 2008 at 7:11 pm
They can’t take away Alltel from Newman! They can sponsor Verizon somewhere else… just leave Alltel with Ryan.
Tim Zaegel
Jun 6, 2008 at 9:44 pm
Well, as soon as they decide to pull the plug on the Alltel brand, that pretty much means the end of the sponsorship as well.
Adam C
Jun 7, 2008 at 10:38 am
I think flyin ryan will be just fine with sponsership weather its alltel verizon or someone else!
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