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AT&T to acquire TMobile for S39 billion

post #1 of 82
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AT&T has announced a definitive agreement to buy Deutsche Telekom's American T-Mobile subsidiary in a cash and stock deal worth about $39 billion, and giving the German carrier an 8 percent stake in AT&T.

The two companies issued a press release outlining the terms of the deal, which has been approved by the board of both carriers.

T-Mobile and AT&T share similar GSM and UMTS/HSPA networks, and both are working to build new next generation networks using HSPA+ and LTE. However, obtaining the rights to radio spectrum and building out these networks is both expensive and complex.

AT&T's chief executive Randall Stephenson said the deal "provides a fast, efficient and certain solution to the impending exhaustion of wireless spectrum in some markets, which limits both companies ability to meet the ongoing explosive demand for mobile broadband."

More in common with AT&T than Sprint

T-Mobile had been rumored to be entering talks with Sprint, but those two companies run incomparable networks and have diverging future plans, as Sprint operates both CDMA and iDEN (from its merger with Nextel, which it plans to phase out) networks and has begun building a next generation WiMAX network with Clearwire (WiMAX competes with LTE as a next generation mobile network technology).

Germany's Deutsche Telekom chief executive René Obermann noted that "After evaluating strategic options for T-Mobile USA, I am confident that AT&T is the best partner for our customers, shareholders and the mobile broadband ecosystem. Our common network technology makes this a logical combination and provides an efficient path to gaining the spectrum and network assets needed to provide T-Mobile customers with 4G LTE and the best devices. Also, the transaction returns significant value to Deutsche Telekom shareholders and allows us to retain exposure to the U.S. market."

Benefits for AT&T users

The release said that AT&T and T-Mobile USA customers "will see service improvements - including improved voice quality - as a result of additional spectrum, increased cell tower density and broader network infrastructure," noting that as soon as the deal closes, AT&T "will immediately gain cell sites equivalent to what would have taken on average five years to build without the transaction, and double that in some markets."

Absorbing T-Mobile "will increase AT&Ts network density by approximately 30 percent in some of its most populated areas, while avoiding the need to construct additional cell towers. This transaction will increase spectrum efficiency to increase capacity and output, which not only improves service, but is also the best way to ensure competitive prices and services in a market where demand is extremely high and spectrum is in short supply," the release says.

By bolstering its existing GSM, UMTS and HSPA+ networks, AT&T will be able to better focus on future LTE capacity, rather than struggling to get its existing network to meet today's demand. While T-Mobile operates its 3G UMTS network on different frequencies than AT&T, its basic 2G GSM network is identical. AT&T can also use the networks and towers T-Mobile operates to strengthen its own.

T-Mobile adds 33.7 million subscribers to AT&T's network of of about 95.5 million, creating a total of about 130 million users, and becoming the largest American carrier. The deal will also expand Apple's iPhone to three of what were the top four US carriers, as Apple has already brought it to Verizon earlier this year.
post #2 of 82
Quote:
Originally Posted by AppleInsider View Post

AT&T has announced a definitive agreement to buy Deutsche Telekom's American T-Mobile subsidiary in a cash and stock deal worth about $39 billion.

press release.

Wow that is a surprise, at least for me.

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post #3 of 82
Well, now...can't wait for the commercial with the girl in the pink dress. I wonder where her lipstick will end up?
post #4 of 82
Well this is great news for AT&T! Since T-Mobile already has "4G" service and advertised how AT&T didn't, that means that AT&T iPhone users will now have 4G speed... right? RIGHT?!?
post #5 of 82
Quote:
Originally Posted by Claude427 View Post

Well, now...can't wait for the commercial with the girl in the pink dress. I wonder where her lipstick will end up?

On a pig?

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post #6 of 82
So AT&T will be the only nation wide GSM provider in the US? That doesn't sound good.
post #7 of 82
Quote:
Originally Posted by NasserAE View Post

So AT&T will be the only nation wide GSM provider in the US? That doesn't sound good.

Oh god... at first glance I read the headline as APPLE buys Tmobile, which would have been the worst idea EVER.

Well, yes ATT will the only nationwide GSM provider. But they didn't compete anyway, so what's the point of having two? Hopefully this will provide regulators with a chance to do what they are supposed to do - ensure that ATT is forced to provide decent wholesale access to outsiders. Also they could impose rules to force changes in contract structures, or, best of all, force ATT to offer cheaper plans to those who are not using a phone on subsidy.

Won't happen, because our politicians suck, but it'd be nice.
post #8 of 82
I can't believe this! Hopefully the government stops this from happening or at least makes AT&T divest in a lot of markets. There's only a handful of GSM carriers nationwide and with there being just one nationwide provider we're in for some anti-competitive moves by AT&T (I hope not though).

I feel sorry for T-mobile customers, there goes their quality.
post #9 of 82
poor verizon...
what's betting that they buy sprint just so they can keep saying they are the largest cellular network?
Whatever. Seriously concidering ATT now that they will (hopefully) have decent NY service.
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post #10 of 82
I was a T-Mobile customer for years and as JDPowers and others confirmed many times, they had the best customer service by far of any US carrier. And they generally had the most innovative, consumer friendly rate plans. Too bad that wasn't enough to overcome their spectrum limitations. I'll be sorry to see them go.

Speaking of which, who will buy that 1700mhz band they own? Apple never showed any interest in accommodating it.
post #11 of 82
And this provides a very good lesson for those who thought Apple was saving up their $60 billion in cash to make a big purchase. This purchase cost ATT exactly FIVE billion of cash. The rest of the $25 billion cash was financed. As it would be in any deal Apple might make.
post #12 of 82
Quote:
Originally Posted by iGuessSo View Post

I was a T-Mobile customer for years and as JDPowers and others confirmed many times, they had the best customer service by far of any US carrier. And they generally had the most innovative, consumer friendly rate plans. Too bad that wasn't enough to overcome their spectrum limitations. I'll be sorry to see them go.

Speaking of which, who will buy that 1700mhz band they own? Apple never showed any interest in accommodating it.

Didn't you hear? ATT just bought it.
post #13 of 82
Quote:
Originally Posted by mstone View Post

On a pig?

Bravo, sir.

I truly LOLed.
post #14 of 82
Quote:
Originally Posted by NasserAE View Post

So AT&T will be the only nation wide GSM provider in the US? That doesn't sound good.

For now AT&T will be the only GSM provider in the USA but two to three years from now it won't matter because all the major carriers (AT&T, Verizon, Sprint) will be entrenched in LTE technology. By that time you'll have everyone using one single standard which makes changing carriers easier.
post #15 of 82
Quote:
Originally Posted by robbydek View Post

Hopefully the government stops this from happening or at least makes AT&T divest in a lot of markets.

Violations of Section 1 of the Sherman Act don't get much clearer than this. Hopefully the Justice Department will block the deal.
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post #16 of 82
Quote:
Originally Posted by cameronj View Post

Oh god... at first glance I read the headline as APPLE buys Tmobile, which would have been the worst idea EVER.

Well, yes ATT will the only nationwide GSM provider. But they didn't compete anyway, so what's the point of having two? Hopefully this will provide regulators with a chance to do what they are supposed to do - ensure that ATT is forced to provide decent wholesale access to outsiders. Also they could impose rules to force changes in contract structures, or, best of all, force ATT to offer cheaper plans to those who are not using a phone on subsidy.

Won't happen, because our politicians suck, but it'd be nice.

Oh yeah, let's get those politicians more involved in the marketplace! That always works out well, doesn't it?
post #17 of 82
Quote:
Originally Posted by mcarling View Post

Violations of Section 1 of the Sherman Act don't get much clearer than this. Hopefully the Justice Department will block the deal.

Really? How so? Seems there will still be plenty of competition. ATT is, and will remain, far from a monopoly.
post #18 of 82
Seems like we are rapidly coming full circle, back to those days monopolistic days of Ma Bell! How many Major Telecoms are left in the US now???

We have sooo many companies to choose from for our wireless provider! Competition was going to make the industry more efficient and bring down pricing, remember???

We are STILL paying for both sending AND receiving calls on cell phones! That is INSANE!

Rant over, going back to pick up my paper cup on a string...
post #19 of 82
Quote:
Originally Posted by cameronj View Post

Didn't you hear? ATT just bought it.

They bought the spectrum, but what will they do with it? Unless all their handsets can make use of it, it would just perpetuate a T-Mobile sized network for the ones that did. I think they'll try to sell it to someone, but who could make use of it?
post #20 of 82
Quote:
Originally Posted by Claude427 View Post

Well, now...can't wait for the commercial with the girl in the pink dress. I wonder where her lipstick will end up?

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post #21 of 82
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Originally Posted by aquajets1 View Post

poor verizon...
what's betting that they buy sprint just so they can keep saying they are the largest cellular network?
Whatever. Seriously concidering ATT now that they will (hopefully) have decent NY service.

AT&T probably will have better coverage, but at what cost?
AT&T wants T-mobile for its GSM towers so that it can rapidly improve its quality without the extra costs. Sorry, T-mobile! You have the iPhone now, but there goes your quality.
post #22 of 82
Quote:
Originally Posted by mcarling View Post

Violations of Section 1 of the Sherman Act don't get much clearer than this. Hopefully the Justice Department will block the deal.

Not going to happen. I don't see how this purchase violates section 1 of the Sherman Act. There is no restraint of competition since they did not really compete anyways. Plus, you are forgetting that AT&T still has lots of competition from Verizon. Looking forward to having better reception
post #23 of 82
Quote:
Originally Posted by mcarling View Post

Violations of Section 1 of the Sherman Act don't get much clearer than this. Hopefully the Justice Department will block the deal.

Lately, I'm not so ensure about the government enforcing laws. I'm hoping they prove me wrong this time.
post #24 of 82
Quote:
Originally Posted by StLBluesFan View Post

Oh yeah, let's get those politicians more involved in the marketplace! That always works out well, doesn't it?

I'm Mr. Libertarian, and yes, politicians tend to be idiots about economic decisions. But they're in this market already, so they might as well try to move motivations toward where they help the market rather than cripple it. There are good and powerful restrictions that they could place on this deal to get the US out of the 2 year lockup/free phone for everyone trap that we're in.

Tell me what you think about a rule to force providers to lower prices for people using their own phones? It seems to me like you could design a rule that forces ATT to make it clear how much your subsidy is when you buy a new phone, and then, how much of any subsidy you pay down every month in a given plan.

Say you buy an iPhone for $200. ATT must tell you that the original price was $599, and you have a $399 subsidy. You then have your choice of plans. $110 ($25), $90 ($18), $70 ($12) and $60 ($10) with the parenthetical number being the amount that you pay down monthly, or would save if bringing your own phone. When you get a subsidized phone, you are effectively getting a 2 year loan from ATT. Mortgage companies are forced to tell you APRs, why shouldn't cell providers be forced to be more open about what you're actually paying for?

This removes the nitty gritty of pricing decisions from the government, which of course they couldn't do anyway. ATT still has full control over pricing, but if it wants to offer subsidized phones, it is forced to make it clear how much that subsidy is, so people who don't want subsidized service can make a choice. The key is finding a way to write it so that it is self-enforcing. ATT must want to reveal the information to the customers who want the subsidy despite the small number of people who will stop receiving it.

Do you think such a design would work?
post #25 of 82
While this makes sense on some fronts, the problem will be even LESS competition, ultimately meaning higher prices for consumer, I would venture.
post #26 of 82
Truthfully I've never understood all the hate for AT&T. They always gave us excellent customer service and coverage (switched from Verizon).

This can be good for service, or considered anti-competitive, but I think it IS kind of a company's job to be better than the competition, and if they're notthen Verizon and Sprint still exist.

Maybe I'm missing the point, but I think AT&T will have lots of competition still. I don't think the average user knows or cares about GSM vs CDMA.
post #27 of 82
Quote:
Originally Posted by tru_canuk View Post

For now AT&T will be the only GSM provider in the USA but two to three years from now it won't matter because all the major carriers (AT&T, Verizon, Sprint) will be entrenched in LTE technology. By that time you'll have everyone using one single standard which makes changing carriers easier.

Somehow, I'm not convinced. One or the other will do something that ensures their system is incompatible with the competition. Total compatibility would erase perceived competitive advantages and make changing networks a cakewalk. Never happen. Never.

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post #28 of 82
Government that governs least governs best. I hope they stay out, as they are part of the spectrum allocation problem, and when is the last time government did anything right?

Examples: US Postal Service, Government schools -- abominations which would never be so lackluster if they was a free market!


Quote:
Originally Posted by robbydek View Post

I can't believe this! Hopefully the government stops this from happening or at least makes AT&T divest in a lot of markets. There's only a handful of GSM carriers nationwide and with there being just one nationwide provider we're in for some anti-competitive moves by AT&T (I hope not though).

I feel sorry for T-mobile customers, there goes their quality.
post #29 of 82
Quote:
Originally Posted by StLBluesFan View Post

Oh yeah, let's get those politicians more involved in the marketplace! That always works out well, doesn't it?

What as opposed to the "free markets" you guys currently employ that has raped and pillaged your country to the point where the rest of the world laughs at you?

The same markets that have given you the crappiest healthcare system, immense unemployment, poor competition in the cellular market etc?

Capitalism doesn't work and has never worked. It just serves to screw the little people and make the already rich even richer. It doesn't benefit the country and until America realises this they will forever go downhill.

I can speak about this because I live in New Zealand and since the 80's this country has moved towards an American style capitalist society from the country's socialist roots and the country has gone downhill ever since.

At least Vodafone seems to be the lesser of two evils. Ok, there is three cell companies in New Zealand but 2Degrees' data plans suck balls. That leaves Telecom who has held the country to ransom for the past 20 years so they're hardly a shining beacon of light.
post #30 of 82
Quote:
Originally Posted by NasserAE View Post

So AT&T will be the only nation wide GSM provider in the US? That doesn't sound good.

Sheit, I just bought prepaid T-mobile data card and wanted to get off the contract with ATT - this is really bad news for choice.... if you want GSM you will be left with 1 option only... very expensive one. Isn't this to be approved by some kind of antimonopoly office first?
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post #31 of 82
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Originally Posted by lowededwookie View Post

What as opposed to the "free markets" you guys currently employ that has raped and pillaged your country to the point where the rest of the world laughs at you?

The same markets that have given you the crappiest healthcare system, immense unemployment, poor competition in the cellular market etc?

Capitalism doesn't work and has never worked. It just serves to screw the little people and make the already rich even richer. It doesn't benefit the country and until America realises this they will forever go downhill.

I can speak about this because I live in New Zealand and since the 80's this country has moved towards an American style capitalist society from the country's socialist roots and the country has gone downhill ever since.

At least Vodafone seems to be the lesser of two evils. Ok, there is three cell companies in New Zealand but 2Degrees' data plans suck balls. That leaves Telecom who has held the country to ransom for the past 20 years so they're hardly a shining beacon of light.

Since the 80s, NZ has seen steadily decreasing unemployment until the world recession in 2009.

http://www.tradingeconomics.com/Econ...spx?Symbol=NZD

Moves toward market economies are vastly positive, but those who are less skilled and were supported on the teat of the government under socialism may very well be hurt by it, as they should be. Is that you?
post #32 of 82
Quote:
Originally Posted by StLBluesFan View Post

Seems there will still be plenty of competition. ATT is, and will remain, far from a monopoly.

Three is far from a monopoly? No, three is very nearly a monopoly. Fewer competitors than about eight is a problem.
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post #33 of 82
Quote:
Originally Posted by tru_canuk View Post

For now AT&T will be the only GSM provider in the USA but two to three years from now it won't matter because all the major carriers (AT&T, Verizon, Sprint) will be entrenched in LTE technology. By that time you'll have everyone using one single standard which makes changing carriers easier.

LTE is for data only. The voice is still via GSM network.
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post #34 of 82
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Originally Posted by gabberattack View Post

LTE is for data only. The voice is still via GSM network.

I don't knowI've thought for a while that the future of these telecoms will be data, since a lot of people use VoIP on their smartphones, and you can get way better international rates. Though that wouldn't be for everyone, of course.
post #35 of 82
Quote:
Originally Posted by autism109201 View Post

Truthfully I've never understood all the hate for AT&T. They always gave us excellent customer service and coverage (switched from Verizon).

This can be good for service, or considered anti-competitive, but I think it IS kind of a company's job to be better than the competition, and if they're notthen Verizon and Sprint still exist.

Maybe I'm missing the point, but I think AT&T will have lots of competition still. I don't think the average user knows or cares about GSM vs CDMA.

Well, if you never tried the better service you can be happy. Everywhere in Europe people DO NOT PAY for incoming calls or incoming messages. ONLY IN AMERICA....

Somebody spammed my phone with tens of messages few years ago - 15 cents a piece. I was forced to block messaging to avoid hundreds of dollars cost.... this is insane.
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post #36 of 82
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Originally Posted by gabberattack View Post

Well, if you never tried the better service you can be happy. Everywhere in Europe people DO NOT PAY for incoming calls or incoming messages. ONLY IN AMERICA....

I know this country is mostly pathetic when it comes to technology anyway.
But I was talking only about the United States, since this affects people in the US only.

But you're right it's pathetic over here.
post #37 of 82
Quote:
Originally Posted by mcarling View Post

Three is far from a monopoly? No, three is very nearly a monopoly. Fewer competitors than about eight is a problem.

There's very little precedent for the government to block a deal like this. AT&T will still have less than 50% market share on a national basis. Now if Verizonwireless were to announce a deal to acquire Sprint, that would get more scrutiny as their market share would be in excess of 50%.
post #38 of 82
Quote:
Originally Posted by libertyforall View Post

Government that governs least governs best. I hope they stay out, as they are part of the spectrum allocation problem, and when is the last time government did anything right?

Examples: US Postal Service, Government schools -- abominations which would never be so lackluster if they was a free market!

I think this is a failed analogy. I can site a zillion other reasons that grade and high school education should not be left to the private sector. There is always an incentive to give the least amount of service for the most amount of money. That alone makes for a bad idea. Simply governing less is the simpletons solution to solving problems when our problems are far and away more complex than telling the government not to govern.
post #39 of 82
Quote:
Originally Posted by Claude427 View Post

Well, now...can't wait for the commercial with the girl in the pink dress. I wonder where her lipstick will end up?



I was thinking the same thing.
post #40 of 82
My question is how will Apple react to this? Will we see a LTE iPhone in the works sooner?
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