Slashdot Mirror


Why the AT&T and T-Mobile Merger Is Bad For Consumers

adeelarshad82 writes "AT&T recently announced that it will buy T-Mobile for $39 billion. If the transaction gets approved by the government and closes in a year as planned, it will create the nation's largest wireless carrier by far. While this is great news for both companies, analysts believe that it's an awful idea for end consumers for a number of different reasons — from obvious ones, like a rise in rates due to lower competition, to subtler ones, like more selective phone choices for consumers."

28 of 367 comments (clear)

  1. $39 BILLION!? by MrEricSir · · Score: 4, Insightful

    Where was that $39 billion when it came to putting up and maintaining signal towers? Where was that $39 billion when it came to customer service? Where was that $39 billion when it came to the outlandishly expensive service?

    All this money, and what does AT&T do with it? It's like a slap in the face for their own customers.

    --
    There's no -1 for "I don't get it."
    1. Re:$39 BILLION!? by Dyinobal · · Score: 3, Insightful

      Those wonderful 39 billion don't generate cash when put into more towers, customer service or anything that other wise improves the service they are providing. Where as spending 39 billions to take over a competitor and gain a mess load of new customers does. In short they don't care about anything besides the $$$$$ which shouldn't surprise you, considering they are a corporation and are by nature soulless evil things.

    2. Re:$39 BILLION!? by dgatwood · · Score: 3, Insightful

      They will suddenly have to maintain all of T-Mobile's hardware, but it won't do them that much good. AT&T's 3G and T-Mobile's 3G use different bands, and the vast majority of phones don't have the hardware to support both. At best, they could offload a little bit of 2G voice and EDGE traffic.

      --

      Check out my sci-fi/humor trilogy at PatriotsBooks.

    3. Re:$39 BILLION!? by dgatwood · · Score: 4, Interesting

      Corporations aren't evil. They're amoral. There's a subtle difference.

      --

      Check out my sci-fi/humor trilogy at PatriotsBooks.

    4. Re:$39 BILLION!? by characterZer0 · · Score: 4, Insightful

      The company is amoral. The management are evil.

      --
      Go green: turn off your refrigerator.
    5. Re:$39 BILLION!? by MickyTheIdiot · · Score: 5, Interesting

      They are amoral, but allow evil deeds to flourish because the people doing the deeds know they will never be held accountable. Lack of personal accountability is the REAL evil of the corporations.

    6. Re:$39 BILLION!? by dkleinsc · · Score: 3, Insightful

      Or as the wonderful Canadian documentary The Corporation pointed out, if a corporation is legally a person, then it is a sociopathic person. It's not that they're actively trying to do bad things, it's just that they don't care if they do evil, so long as it benefits them.

      --
      I am officially gone from /. Long live http://www.soylentnews.com/
    7. Re:$39 BILLION!? by Andy+Dodd · · Score: 3, Informative

      That's why a bunch of people think this merger happened. Supposedly it's about a 5-year process to get a new cell site approved by the FCC. (e.g. it's not about money, it's about paperwork delay).

      The problem is: T-Mobile's 3G sites are all in the 1700 MHz band. No AT&T handset supports UMTS1700 to my knowledge, so AT&T phones won't be able to use the new tower assets for 3G. A cell site approval from the FCC is not based just on siting - it's licensed for a specific frequency and power level. So the T-Mo tower assets can't just be switched over to a different band.

      There is a *slight* possibility it may be easier for AT&T to get an STA to change a tower to a new band than to build a new site though.

      As to the negative effect this will have on equipment manufacturers (handset and network infrastructure) - Anyone claiming this will have a significant negative impact on those people is forgetting that there are more countries on this planet than the United States.

      In terms of handsets - AT&T has already been in a situation of using bands not supported by any other carrier anywhere else in the world. Any phones for them had to be specially customized for them. Now, quad-band GSM has been common for a long time, but I have yet to see a UMTS handset that supported both the world frequencies and all of the US frequencies. T-Mobile was slightly fortunate in that unlike UMTS1900/UMTS850, some other countries did use UMTS1700. As a result, manufacturers could target more markets with a handset that supported UMTS1700/2100 than one that supported UMTS2100+the AT&T bands.

      For network equipment providers - nothing changes. Previously you had equipment for AT&T and equipment for the rest of the world, this doesn't change. AT&T is still at a disadvantage of lacking the economies of scale the rest of the world can take advantage of.

      --
      retrorocket.o not found, launch anyway?
    8. Re:$39 BILLION!? by s73v3r · · Score: 4, Interesting

      Even though a lot of people like to pretend they are forced to do business with AT&T, they aren't.

      Except when they buy the provider you went with to avoid going with AT&T.

    9. Re:$39 BILLION!? by spun · · Score: 3, Interesting

      If you couldn't go to prison for crimes, wouldn't you do things a wee bit differently? ;-)

      No. I wouldn't. I'm not a sociopath. I don't refrain from doing evil because of a fear of punishment. I refrain from doing evil because I have empathy, and because of that, hurting others hurts me directly. It may also harm me indirectly, as people who have been hurt often lash out irrationally, and people whose choices have been constrained often make choices that harm others, potentially including me. Enlightened self interest looks a lot like selflessness .

      --
      - None can love freedom heartily, but good men; the rest love not freedom, but license. -- John Milton
    10. Re:$39 BILLION!? by Daetrin · · Score: 3, Interesting

      If you couldn't go to prison for crimes, wouldn't you do things a wee bit differently? ;-)

      No. I wouldn't. I'm not a sociopath. I don't refrain from doing evil because of a fear of punishment. I refrain from doing evil because I have empathy, and because of that, hurting others hurts me directly.

      I don't do evil things to people that i consider good because of empathy.
      I don't do evil things to people that i consider evil but who honestly think they're doing good because of morality.
      I don't do evil things to clearly evil people (people who do evil and don't give a fuck as long as it benefits them in some way) because of the law, ie fear of punishment.

      If that means i'm not as civilized as i ought to be, oh well. Not that it makes a big difference practically speaking, since barring the collapse of civilization i'll behave the same in all circumstances anyways.

      --
      This Space Intentionally Left Blank
  2. But its good for Verizon and others by Fujisawa+Sensei · · Score: 3, Interesting

    It is certainly bad for customers.

    But its good for Verizon and others, because there are a lot of T-Mobile who are: "Anybody but AT&T".

    --
    If someone is passing you on the right, you are an asshole for driving in the wrong lane.
  3. What competition? by 0racle · · Score: 4, Insightful

    There is no real competition in the US mobile market, only the illusion of competition.

    --
    "I use a Mac because I'm just better than you are."
    1. Re:What competition? by royallthefourth · · Score: 4, Informative

      This is the nature of all markets: the big ones buy up the smaller ones until there are only one or two big ones left. Occasionally they collapse and are replaced by others, but the diversity never really expands.
      Deregulation and competition just doesn't work in the real world.

    2. Re:What competition? by dkleinsc · · Score: 3, Insightful

      You're overstating your case a bit.

      Some markets do lend themselves to consolidation like this. If you were a hypothetical omnipotent and benevolent Grand Pooh-bah of the cell phone market right now, you could cut costs of cell service significantly by reducing things to a single carrier, and then sell the service at cost. But instead, we have profit-driven corporations, who want to cut the costs but keep the prices at their current higher (and thus inefficient) price.

      Other markets don't consolidate as easily, which is why, say, plumbers aren't all working for a handful of big conglomerates.

      --
      I am officially gone from /. Long live http://www.soylentnews.com/
  4. Re:Reject by C_amiga_fan · · Score: 3, Informative

    P.S.

    "AT&T's 700 Mhz spectrum" came from the selloff of TV channels 52 through 69. ATT, Verizon, and the FCC are pushing to selloff channels 25 and up, too, effectively killing free television (there would be one-half as many stations).

    --
    FREE magazine : http://clarkesworldmagazine.com/prior/
  5. Great news for both companies? by blair1q · · Score: 5, Interesting

    AT&T shareholders just watched their management pay way too much for T-mobile. T-mobile and AT&T employees are both now extremely fearful for their jobs, as there is almost 100% overlap in most markets in everything but customer service call centers. This goes all the way up the management chains.

    This is less like "joining forces" than conquering your neighbor by buying his mortgage from the bank for double the house's value, then throwing him and his kids and your wife out on the street.

  6. Re:Reject by dgatwood · · Score: 5, Informative

    It's ultimately not the FCC, but rather, the DOJ that would have to step in and stop it. So write them.

    --

    Check out my sci-fi/humor trilogy at PatriotsBooks.

  7. Its a done deal by Fujisawa+Sensei · · Score: 4, Interesting

    They haven't denied any of the other mergers that became the current AT&T.

    They didn't deny SBC when they wanted to offer long distance service either.

    They're not going to deny this either.

    I'm rather surprised they didn't buy Comcast.

    But of course, they might try it even before this deal completes.

    --
    If someone is passing you on the right, you are an asshole for driving in the wrong lane.
    1. Re:Its a done deal by AK+Marc · · Score: 4, Informative

      First off, you missed the sarcasm (even with a link pointing it out). Second, AT&T didn't buy back the baby bells. AT&T castrated itself by keeping what would be the losing business entity with the cool name. Southwestern Bell changed to SBC to hide the regionality of its name, then bought out AT&T (and changed its name again, someone at the top of Southwestern Bell was apparently ashamed of the Dallas roots of the company). So a baby bell bought the momma because the momma was incompetently run (and was under greater regulations while the babies were passing it with fewer regulations). But AT&T didn't reacquire the baby bells, the baby bells consolidated and then committed matricide.

      Not that the net effect isn't essentially the same, but the path was not how you described it.

  8. A loan from JP Morgan by Anonymous Coward · · Score: 4, Informative

    A loan from JP Morgan

    http://www.reddit.com/r/AskReddit/comments/g7vzu/why_the_hell_does_att_have_25_billion_in_cash/

  9. Led Zepplin by MickyTheIdiot · · Score: 4, Informative

    Go to the T-Mobile forum if you want to know how well this is flying with T-Mobile customers.

    The subject should give you an indication.

    I explicitly chose NOT to have anything to do with AT&T and now I am forced into it. Does that sound like free capitalism to you??

    1. Re:Led Zepplin by royallthefourth · · Score: 3, Insightful

      Does that sound like free capitalism to you??

      Yes. Capital is free; you are not.

      Social relations are replaced by market relations so instead of each person having equal freedom intrinsic in his existence, money itself becomes a measure of the decisions a person is able to make. They've got billions of dollars and you probably have only a few thousand.
      This is the meaning of freedom created by the marketplace.

  10. AT&T reminds me of Terminator 2 by mykos · · Score: 3, Funny

    You freeze it, break it to pieces, and over a small amount of time it melts and re-forms itself to continue the assault.
    Where's a vat of molten steel when you need it?

  11. Re:Reject by VGPowerlord · · Score: 4, Informative

    "AT&T's 700 Mhz spectrum" came from the selloff of TV channels 52 through 69. ATT, Verizon, and the FCC are pushing to selloff channels 25 and up, too, effectively killing free television (there would be one-half as many stations).

    This would be one of the reasons why the DTV transition is happening world-wide, so governments can reassign the spectrum for other uses.

    In the US, low power stations are still allowed to transmit, but they know they are on borrowed time, as the international date to end analog television signals is June 17, 2015.

    --
    GLaDOS for President 2016! "Well here we are again. It's always such a pleasure." -- GLaDOS, 2011
  12. Re:Reject by ciscoguy01 · · Score: 5, Interesting

    The DOJ only has jurisdiction over federal anti-trust laws. And while we may not like it, this does not actually breach any of those laws

    This does violate the Sherman Antitrust Act.
    Why do you say having only one GSM carrier in the entire country wouldn't result in less or no competition?

    GSM is the only network wherein your Iphone can talk and use data at the same time.
    I for one am against any more consolidation among huge companies. We have had it in banks, supermarkets, phone companies, we don't need any more. Do you want there to be only one or two banks, one or two wireless carriers, one or two supermarkets, and that's it? If you don't like it you can just not buy any. I want more competition, not less. More companies duking it out so I have choice.

    These wireless companies have spectrum licenses. They don't own those frequencies, they get to use them in the public interest.
    Remember when AT&T bought Cingular? They sold off the old AT&T network and frequencies to Tmobile. They kept the better performing Cingular Wireless network. Why did they do that? They had to. The Justice Department wouldn't let them buy their competition unless they divested those assets. That's fair. MORE competition, not less.

    AT&T and the baby bells were all separated out years ago in the AT&T Divestiture. Now, Pacbell turned into SBC which bought Bellsouth and others and finally bought their former parent AT&T, and whopee, they are all back together. It was a 25 year plan, they planned it all, the crooks.
    Now they want to take away more customer choice.

    Just say no. No to companies buying their competition. No to consolidations that limit competition. Especially where these companies have government licenses. It's just not right.

    --
    .
  13. Hardware Filters by Benanov · · Score: 3, Informative

    That's not quite the case - a lot of the radios have hardware filters that can't be removed very easily - you'd be looking at desoldering surface-mount components and then replacing them with other versions...and then recertifying the entire thing to make sure you can still transmit without breaking FCC regulations (at least in the States.)

    The OpenMoko FreeRunner came in two versions - 900/1800/1900, and 850/1800/1900. It is not possible to change frequencies, and almost the entire phone is open to modification by the user.