AT&T/T-Mobile Merger Horrible For Anyone Who Isn't a Billionaire Shareholder
By admin, WirelessEmporium
March 21, 2011
For those not tapped into the cellular world, a major shakeup happened over the weekend. AT&T is buying T-Mobile. Sprint was rumored to be the potential buyer, so the AT&T move really is coming out of nowhere.
First the details. AT&T is purchasing T-Mobile for $39 billion. Of that $25 billion is in cash and the rest will be paid in AT&T stock. The deal still needs to get FCC approval, and Sprint is already claiming that this deal violates anti-trust laws. It is expected that it will take at least a year for this deal to be finalized. In the interim, T-Mobile customers won't be affected in any way shape or form. T-Mobile will still operate as an independent company.
Once the deal does go through, and it almost inevitably will, expect a lot of changes, almost none for the best.
First off, by eliminating one of the 4 major national carriers, you will eliminate nearly 25% of the new handsets hitting the market. Less selection is never good. Couple that with the fact that AT&T tends to be late to the party when it comes to new handsets (last carrier to offer Android) and the outlook is even more bleak.
On top of that, AT&T and Verizon will combine to control more than 80% of the wireless customers in the US. Less competition will inevitably lead to higher prices. And that's not just for T-Mobile customers, but for everyone. Making things even worse is that AT&T will be the only national GSM carrier in the US.
AT&T customers might actually see a slight improvement in their network as T-Mobile's cell sites get converted and some of the 2G bandwidth can be funneled immediately reducing strain on AT&T's network. But that serves as little consolation to T-Mobile's current 34 million subscribers who will need to change to an AT&T phone within the next two years or change networks altogether.