Verizon Communications, which owns 55 percent of Verizon Wireless, said it won't pay dividends to U.K. mobile giant Vodafone, which owns the other 45 percent of Verizon Wireless, until at least 2010. Vodafone has not received any dividends on its substantial stake since 2005. Verizon has blamed the wireless unit's debt, though it's adding to that debt with the planned acquisition of Rural Cellular.
So far, Vodafone isn't making much of the delay, though it reportedly assumes dividends will resume as early as 2009. This transatlantic partnership always has simmered with hints of a quiet power struggle. Through the dividend-free years, Vodafone has declined to sell its stake in Verizon Wireless, which is something I'd be fuming about if I were Verizon.
Right now, it doesn't seem like the uneasy partnership cripples Verizon strategically, but as major telcos seek more corporate, strategic and technical integration with their wireless units, that's bound to change.