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AT&T To Offer Wireless Bundle

Long distance giant AT&T on Tuesday announced a pact to resell cell phone service from its AT&T Wireless spin-off in order to compete with hard-charging rivals offering similar bundles.

The agreement to wrap wireline and wireless services in one phone bill between the two companies had been rumored for weeks, followed by discussion among analysts over AT&T's decision to spin-off its wireless division in the first place.

For its part, AT&T said the bundled service was an attempt to "eliminate the hassle of weighing the use of one communications technology over the other."

Initially, the plan is to offer AT&T residential long distance customers the ability to manage their combined wired and wireless spending through a single provider. Bundled pricing plans were not released.

The wireless services will be powered by and branded as AT&T Wireless, which markets mobile voice and data services using TDMA .

The AT&T bundling move comes amidst a general trend in the telecommunications space to package different services into a single offering. By marketing cell phone minutes alongside wired services for a flat rate or at huge discounts, carriers have been able to avoid churn and bite into AT&T's market.

It is a reality not lost on AT&T chairman and CEO Dave Dorman. "Communications are more about convenience and simplicity than ever before. [This bundled] wireless and wireline calling plan will allow users to select the right phone for the right occasion...Consumers no longer will have to contract with multiple vendors to get the services they want and need," Dorman said in a statement.

John Zeglis, CEO of AT&T Wireless, said the bundling deal opens the door to target otherwise hard-to-reach customers.

"It supports an important strategic thrust for AT&T Wireless of attracting new customers in creatively cost-effective ways," Zeglis added.

AT&T, the number one U.S. long distance carrier, said the bundled calling plan would be available in select markets this summer. National rollout could be available by the end of the year.