AT&T announced today that it has given up on merging with T-Mobile, and will pay T-Mobile the tidy sum of $4,000,000,000 (yeah, that’s $4B) as a parting gift.
Look for T-Mobile to either buy some second tier carriers, to perhaps do a deal with Sprint (see that posting here).
I have to wonder whether the following might happen:
1. The Department of Justice is successful in its suit to block the proposed AT&T&T merger or AT&T gives up, pays T-Mobile the $6B cancellation fee; and then
(….hear in your mind’s ear the ethereal sounds of harps and chimes….)
2. King Deutsche Telekom–disappointed at the loss of suitor King AT&T–continues to peddle Princess T-Mobile as a bride for some other lessor noble suitor; and then
3. Prince Sprint steps up says to Princess T-Mobile, ‘Oh, please marry me, Highness!’; but at about the same time then
4. Prince Sprint suddenly remembers that he’s already married to an ugly wife, named Countess Nextel; and then
5. Prince Sprint calls the Royal divorce lawyers to rid itself of Countess Nextel (really, to profitably free himself of the Countess’s land sites and frequencies) to uses the divorce settlement to help finance the ‘reverse dowry’ it offered to King Deutsche Telekom); and then
6. Prince Sprint and Countess Nextel go their separate ways (likely some lesser suitor will step up to protect Nextel’s honor and propose marriage); and then
7. Prince Sprint and Princess T-Mobile wed uniting their lesser kingdoms into one land, and then
8. Many of Princess T-Mobile’s hand maidens (they’re called employees in T-Mobiledom) find themselves put out of the castle, while the lucky few other retainers are invited to pledge their allegiance the court contractors of Prince Sprint, but
9. The serfs (oddly called ‘subscribers’ for some strange reason) in the newly combined Kingdom of SpriT-Mobile see no difference in their lives. They continue to pay their monthly tribute to the Prince and Princess to be allowed access to the expanded lands of Kingdom and the privilege of communicating with other serfs of SprinT-Mobile, and serfs in the other aligned Kingdoms.
The new Royal couple might even have their own Royal Coat of Arms:
…and be known by the Hollywood name of “Sprin-Tee”!
One has to wonder when such a story might come true! For the meantime, this is just a fanciful parody. Yup…just a parody.
Attached to this post is the antitrust complaint filed today by the U.S. Department of Justice against AT&T Inc., T-Mobile USA, Inc., and Deutsche Telekom AG (T-Mobile’s parent).
Case No. 1:11-cv-01560, assigned to Hon. Ellen S. Huvelle
25 pages.
CLICK ON THE LINK BELOW TO DOWNLOAD THE COMPLIANT IN PDF FORMAT (about 1 MB)
In a copyrighted story that appeared in the 8/11/11 edition of Wireless Week, Maisey Ramsay wrote about an AT&T/T-Mobile merger document that appeared on the FCC’s web site, and then disappeared few hours later.
According to Maisey’s story, the interesting AT&T document showed that if the Commission approves the proposed T-Mobile merger, AT&T will expand its high speed data network to rural areas beyond that which they’ve already agreed to serve.
This is an interesting revelation given that the wireless carriers have claimed that its local governments that have stymied their growth through right-of-way regulations that they assert block deployment.
Yeah, right.
Of course we know that those carrier-claims are hollow, and that smaller communities go begging for modern celular/PCS/LTE/AWS services and high speed wireless internet
According to the article:
“AT&T senior management concluded that, unless AT&T could find a way to expand its LTE footprint on a significantly more cost-effective basis, an LTE deployment to 80 percent of the U.S. population was the most that could be justified,” AT&T counsel Richard Rosen stated in the letter.
The company said its merger with T-Mobile would spread the cost of the LTE expansion over a larger revenue base, allowing it to “better absorb the increased capital investment and lower returns associated with deploying LTE to over 97 percent of the U.S. population.”
Thanks, Richard… You’ve confirmed what we’ve known, and what the Commission needs to know.
It’s all about the money…the carriers’ money…
…and not about claims that it’s the local governments are blocking deployment. It’s the money, stupid!
-Jonathan
The California Public Utilities Commission will launch an investigation into the pending AT&T/T-Mobile merger.
The Commission, which is now populated by a majority of members appointed by Gov. Jerry Brown, will evaluate whether to propose conditions on the merger. The Commission will be taking public testimony, and moving its review along a fast track which may result in a Commission action in October of this year.
Here are two links with additional 
information on the pending CPUC review:
The Los Angeles Times article: http://latimes.com/business/la-fi-puc-att-20110609,0,2964962.story
The CPUC Press Release: http://docs.cpuc.ca.gov/word_pdf/NEWS_RELEASE/136944.pdf
Reuters is reporting that AT&T CEO Randall Stephenson believes that his company will have to divest portions of its existing wireless network to secure federal permissions to acquire T-Mobile. Stephenson’s comments were made in New York at a Council on Foreign Relations event held on March 30, 2011
My suspicion is that T-Mobile will be similarly required to divest portions of its existing wireless network in the same or adjoining areas as those assets that AT&T will shed to make the deal work for the Feds.
The shed assets will help strengthen the remaining, small competitors, who will then become known as current take-over targets for other major players.
Stephenson also said at the same event that he expected consumer prices for wireless services to continue drop as a result of the proposed merger. His comments came just hours before April Fools Day.
It’s no surprise that T-Mobile will soon cease to exist in the U.S. What is a surprise is that AT&T is claiming the prize, rather than the widely-rumored suitor, Sprint/Nextel.
What is more of a surprise is that T-Mobile lasted so long before giving up the ship. T-Mobile has always played a game of the catch-up wanna-be to the legacy national carriers in the U.S.
What does make sense is that AT&T, rather than Sprint/Nextel looks like the winner: Sprint/Nextel certainly needs access to more sites and licenses, but AT&T can make better use of T-Mobile’s assets, specifically the AWS-Band frequency assignments around 2100 MHz.
AT&T went the other direction when it focused, rightly, on gaining new 700 MHz frequencies for its LTE data (and later, voice) deployments. By taking T-Mobile, AT&T gains more spectrum in the 1900 and 2100 MHz bands to add to its existing 700 and 860 MHz assignments. Sweet. AT&T’s recent purchase of the national 700 MHz band license from the ill-conceived and now all-but-defunct MediaFLO/FLO-TV operation of Qualcomm makes even more sense given the pending marriage with T-Mobile. Sweeter.
Sprint could not have benefited to the same degree as AT&T given that it does not have 860 MHz band assignments (yes, I’m discounting the Nextel assignments for this discussion since those have turned out to be such a poor deal for Sprint).
IF THIS DEAL GOES THROUGH, and there’s certainly a big IF in there, I suspect that the even-newer AT&T will be forced by the DOJ/FTC/FCC to sell off chunks of the existing networks of both firms. This has been the trend in prior mergers/buy-outs, and it’s unlikely that this deal will not see sales of major network assets in the name of competition.
What’s next?
For site landlords, in about a year it will be time to take out their AT&T and T-Mobile lease contracts and look at those transfer terms. It’ll be a really interesting time for site lessors with both AT&T and T-Mobile currently collocating at the same site.
For other wireless carriers, this deal will force some shotgun marriages.
I predict that Sprint/Nextel will now look to MetroPCS. Verizon will look at MetroPCS, too. This may also be the start of the end-game for Cricket Wireless.
Finally, many of the roaming contracts between the biggies and the smaller regional PCS and cellular carriers contain buy-out options (the biggie can for the sale of the small fish). We’ll see Verizon continue its aggressive campaign of Roam-to-Buy as a first step of blunting the AT&T/T-Mobile deal.
For now I think we should start calling the new network: “AT&T&T”!
Findlaw is reporting that AT&T Wireless is offering some of its customers a free in-home microcell (sometimes called a femtocell) … for customer who repeatedly complain about dropped calls.
According to Findlaw, “If you have complained to AT&T about your coverage or have used their application to report dropped calls, you are likely to be contacted by AT&T regarding this offer. It’s something to consider if you haven’t already decided to switch to Verizon. Customers report already beginning to receive letters with offer codes in the mail. If you have difficulty with service at your home or office but haven’t received an offer in the mail, it’s probably wise to call AT&T and give them a little nudge.”
The AT&T “Mark the Spot” app, available at the iTunes Store, is your ticket to reporting AT&T service problems. It’s also the apparent way to get AT&T’s attention that you should get one of their free femtocell.
This is an interesting tool for many reasons, not the least of which is that some smart municipal attorneys might very well look to ‘discover’ this data when AT&T files a law suit in light of a government’s siting permit denial.
…I’m just say’n…
Anyway, I do think that this is an interesting way to try to maintain customers who might be thinking about jumping to Verizon’s iPhone service (even with its data speed and multitasking limitations, but that’s a different posting).
For AT&T’s information on its in-house microcell/femtocell, CLICK HERE.
I predict that AT&T’s data network will experience a noticeable increase in throughput speed throughout 2011. That’s great news for AT&T, and they can thank Verizon for helping to achieve that goal.
Of course, while AT&T struggles to deploy its LTE network, it’s goal of speeding its network will be aided in no small part by Verizon’s expected announcement, on Tuesday 1/11/11 (perhaps at 11:11:11?) that Verizon will finally offer its subscribers an Apple iPhone.
Verizon’s recent announcement that it, too, now calls its data network “4G” just like T-Mobile (…who knew?) sets the stage for heightened expectations, discovery of data holes in Verizon’s network, and other fun stuff.
Years ago I switched to Verizon from AT&T because AT&T’s voice network was inferior in terms of reliability. Until a couple of years ago I wasn’t a data user, but I switched to a VZW Crackberry. Last year I dumped the Crackberry Curve for a Motorola Droid 2 (it’s a good firmware/software platform in a fat, clunky body with a battery demanding nightly recharges…look at HTC, instead of Motorola).
Yeah, when VZW does offer the iPhone, it’s virtually certain that I’ll join the million or so other users switching from AT&T and upgrading from within Verizon. Yes, I’ll be part of the problem; not part of the solution.
As a tip for you unhappy AT&T iPhone users: You can always use your existing GSM iPhone on T-Mobile’s new “4G” network. If you jailbreak your phone and go to T-Mobile, you DO NOT have to buy an expensive new iPhone like you would if you want to go to VZW’s sysetm. That’ll make all of us existing Verizon users very happy, too!
Jonathan
PS: I also predict that 2011 will see (1) huge subscriber churn and net subscriber loses for AT&T, and (2) someone in a wireless marketing department deciding that it’s time to call their network 5G! I’m waiting for 9G, myself. -jlk
AT&T has a pending proposal to install a new tower overlooking Granite Lake, NH, about 15 miles east of Keene, NH. While it’s not a surprise that there is some community resistance, what is a surprise is the quality and effectiveness of this opposition video published by “Cucchicru” at YouTube. This is worth a bit over 5 minutes of your time.
The video quietly makes its point using only images and music. The ‘Before’ music is “Carry Me Across the Mountain” by Dan Tyminski. The ‘After’ music is “Darkness, Darkness” by Jesse Colin Young, performed here by Young as the vocalist of the Youngbloods.
(I take no side in the underlying question about the cell site; I simply point out how effective this video is in expressing its position. -jlk)