SBC Communications Inc.'s planned acquisition of Pacific Telesis Group would have little immediate effect on the cobranded card programs of the two Baby Bells, industry analysts say.
But down the road, they say, the combined telephone company will probably merge the programs under one issuer.
On Monday the companies announced a stock swap in which San Antonio- based SBC, which operates the Southwestern Bell network, would acquire Pacific Telesis Group in San Francisco.
The two would operate under the SBC name and be headquartered in San Antonio. However, the companies said, they would continue to offer products and services under their current brand names.
Asked specifically about the card programs, representatives of both companies said that they would not immediately change - but that it was too early to speak of ultimate plans.
SBC is the larger company, with 1995 revenue of $12.7 billion. It has customers in Kansas, Missouri, Oklahoma, Arkansas, and Texas. Pacific Telesis had $9 billion in revenue from operations in California and Nevada.
Household International, the Prospect, Ill.-based financial-services company, has been issuing the Pacific Bell Visa since July 1994. A Household spokeswoman said the program has 190,000 accounts and $230 million in receivables. In April, Pacific Bell added the MasterCard brand and renamed the card the Pacific Bell Savings Card.
Mercantile Bancorp., St. Louis, has been issuing the Southwestern Bell Visa since March 1995. The card has garnered 500,000 accounts, the bank said; it did not release the outstanding balances.
Michael Auriemma, president of Auriemma Consulting, Westbury, N.Y., said SBC's probable reason for keeping the cobranding programs separate is that they have distinct marketplaces.
"Eventually, you would want to merge those products," he said, adding that this would probably happen when the first of the two contracts comes up for renewal.
Typically, cobranded deals run for five years with opt-out clauses, said Shelly Porges, president, Porges-Hudson Marketing, San Francisco. "At some stage they would merge the card businesses," she said. "It doesn't seem logical to be running two separate card organizations."
Ms. Porges, who has represented Household and Mercantile, said the issuers came to develop their cobranded regional Bell programs from different perspectives.
"For Mercantile it was more of an opportunistic kind of situation, because they and SBC were in the same market area, as contrasted to an overall cobranding strategy." For Household, "cobranding has been an established part of a broad-based strategy."
