AT&T made headlines today by announcing its acquisition of T-Mobile USA from Deutsche Telekom – a deal worth $39 billion. It was surprising because, for years, we’d all been hearing talk about Sprint either merging with or acquiring T-Mobile. Instead, AT&T picked up the nation’s fourth largest carrier along with a ton of spectrum and a promise to deliver 4G LTE to the 46.5 million additional customers when the deal is complete.
However, initial reactions have been mixed. Many say that it’s good news for AT&T, but bad news for everyone else – especially if you’re a GSM customer living in the United States.
We’re also wrought with mixed feelings ourselves, so here are our reactions to this latest piece of news.
This is without a doubt the biggest (pending fed approval of course) mobile-related business deal of the year, if not the decade. If AT&T successfully acquires T-Mobile USA, it would instantly give the AT&T a boost from its current position as the No. 2 largest wireless carrier in the US to the coveted No. 1 spot. That’s nothing to laugh at.
More to the point, the deal would give Sprint and even steeper uphill battle to fight for customers. If AT&T preserves the more affordable pricing structure currently offered by T-Mo, Sprint will have to fight even harder to grab customers with an eye on their wallets.
Now, the flipside of the argument is that this could ultimately hurt consumers. Especially AT&T decides to do away with T-Mobile’s pricing structure. The Deutsche Telekom-backed T-Mo presented a strong competitive pressure on other carriers in the past couple years. It’s possible that, without T-Mobile, the Sprint Simply Everything plans may never have come to be.
In the end though, we have no idea what AT&T wants to do with T-Mobile USA’s customer, infrastructure (cell towers, etc.), and spectrum. Maybe they’ll let Magenta run on its own (unlikely). Maybe they’ll force everyone to jump on board the AT&T network. Maybe they’ll give out free phones with a year of service and become a charitable organization – yeah, don’t hold your breath. This should get interesting.
AT&T has had a rough ride trying to keep its network apace with years of iPhone exclusivity and the data traffic demands it entailed. Verizon’s version has had a somewhat anticlimactic start, but still Big Red maintained a marginal lead. With the iPhone advantage good and gone, it makes sense that AT&T pulled out all the stops to leap-frog VZ and firmly set itself as the top service provider in the U.S.
I worry a bit for loyal T-mobile customers who have been perfectly happy with their service and will now have to share bandwidth with droves of AT&T subscribers. At least folks rolling with T-Mo will probably be able to get the iPhone, eh? Odds are the acquisition will be good news from the device side of things, since we’ll see less fragmentation to accommodate T-Mobile’s AWS bands. I’m curious to see how exactly the manufacturer focus will change between CDMA and GSM technologies now that the U.S. balance has shifted; AT&T will be a bigger, juicier customer for phone makers to attend to, but the CDMA carriers will now outnumber the GSM. From a coverage perspective, it’s hard to imagine service on AT&T not improving, but I guess we’ll see for sure soon enough.
I fear that AT&T won’t keep up with many of T-Mobile’s consumer-friendly practices. T-Mobile has been a favorite of many because of perks like the ability to purchase a device with a contract, or to buy without a contract and pay monthly over time. The carrier also makes tethering or using a smartphone as a mobile hotspot almost hassle-free. I’m also curious to know what will become of T-Mobile’s other great feature – UMA or Wi-Fi calling where users have the ability to make and receive calls over Wi-Fi in areas of weak coverage.
I’m not terribly happy by this. I’ve been with T-Mobile for almost four years now, and I’ve been very happy with them. If Magenta stores eventually turn into Big Blue stores, I will likely switch to Sprint. This cock fight between Verizon and AT&T is bad enough,and having the one carrier I like swallowed up just pisses me off. If T-Mobile remains T-Mobile, just under the AT&T umbrella, I may stay, but If I can’t keep my grandfathered plan, off I go.
I feel torn about this acquisition. Everyone already hates AT&T for its shoddy coverage, pricey plans and fickle rules when it comes to its plans. When I was a T-Mobile customer, I loved the simplicity of its plans, customer service and general wireless coverage. In fact, I’m not the only one: T-Mobile has consistently won J.D. Power & Associates awards for customer service both over the phone and in stores. I can only imagine AT&T taking everything that was great about T-Mobile and tarnishing it with its less than stellar reputation for service.
T-Mobile customers might be screwed. Being the underdog, it can offer affordable plans and competitive rates. Once the deal with AT&T is complete, T-Mobile customers can kiss their attractive plans goodbye once their contracts are up.
I just don’t like AT&T having a monopoly on the country’s GSM network.
AT&T buying T-Mobile is a shocker. After years of rumors, everyone assumed Sprint and T-Mobile would merge to challenge AT&T and Verizon. With the potential merger of AT&T and T-Mobile, AT&T will become the dominant wireless carrier in the U.S. based on subscriber numbers and will gain access to the AWS spectrum which it could use for its LTE network. Unlike Verizon which is using only 700 MHz, AT&T will use a combination of 700 MHz and 1700/2100 MHz for its LTE network. The wireless carrier already owns some of this AWS spectrum, but T-Mobile owns the largest chunk.
This is good news for T-Mobile as the #4 wireless carrier will now get the financial backing of AT&T and a potential way to offer LTE to its customers in the future. Don’t get too excited, though, as this deal may be tripped up by the regulatory approval process. There is little doubt Verizon, Sprint, and other carriers are formulating objections right now and the FCC and DOJ will most likely look at this deal under a magnifying glass as well. It will be interesting to see how this plays out over the next year.