Verizon Chief Defends AT&T-T-Mobile Merger

The proposed merger of AT&T with T-Mobile doesn't impress everyone as a good idea; in particular, Sprint has filed suit to stop the merger, and while hardly a disinterested party, they're not alone in claiming that the resulting megacompany would harm customers. Verizon is taking a different tack; tekgoblin passes along this excerpt: "Verizon Communications chief executive Lowell McAdam has announced that he is supporting the AT&T T-Mobile merger. He warned that the Government has no choice but to let the deal go though unless they want to fix the current spectrum problems. He went on to say 'We need to be very thoughtful on what the impacts would be to the overall industry if this is a way to regulate the industry without actually passing regulation.' The current telcos need more wireless spectrum to continue expanding and operating efficiently so they have resorted to acquiring other companies."

Comments

Doesn't the consumer lose regardless?

[damn_registrars]

I read a while ago that Deutsche Telekom is looking to get rid of its American T-Mobile. I haven't heard anyone else jumping up with an offer to buy it - and it makes sense that only another GSM provider would want to - so it seems there may be a chance of the T-Mobile (as we know it in the US) going away completely if nobody buys it.

So for us poor bastards on T-Mobile it seems that our fate is either

• Become AT&T customers
• Watch T-Mobile go away and become someone else's (possibly AT&T) customer on our own

Re:Doesn't the consumer lose regardless?

[DikSeaCup]

Rumor had it before the AT&T deal was announced that Sprint was negotiating with T-Mobile.

It could easily be one of the reasons why Sprint is so vocal about their opposition to the AT&T deal.

Re:Doesn't the consumer lose regardless?

[poofmeisterp]

Hmm. Yeah. Interesting.

It would make sense to purchase some GSM/TDMA equipment that is in operation while, at the same time, upgrading the UMTS and higher-speed data equipment all over the AT&T network. The GSM / EVDO crud could then be sent out to more distant areas that aren't covered currently. The rest could be sold off at auction or through deals to support overseas basic network establishment. Interesting. Interesting.... Let's see what happens.

Re:Doesn't the consumer lose regardless?

[Artraze]

It's quite unlikely that T-Mobile will just go away. They have a fair amount of inherent value in their infrastructure, and anyone wanting to become a mobile provider (e.g. Google, venture capitalists, etc) would save themselves a great deal of pain by buying T-Mobile (vs. trying to get towers and spectrum themselves). Realistically, though, it seems most likely they'll get spun off as their own business.

The point is, there's more than enough room for T-Mobile or a similar company in the mobile playing field. About the only problems they have are people willing to sacrifice everything else (i.e. cost, customer service, etc) to get an iPhone or avoid that little dead spot that may or may not even exist. This is more a marketing failure than anything. Implying that T-Mobile will disappear is implying that there's not market for well priced reasonable service.

Re:Doesn't the consumer lose regardless?

[poofmeisterp]

Good link. That pretty much sums it all up. Logic would dictate that Sprint has something to gain or lose from the deal; this points to what it is. So was it a lack of gain they're concerned about or is it a little clue that Sprint is losing momentum and about to go belly-up? *rubs hands together*

Re:Doesn't the consumer lose regardless?

[hedwards]

I've said it before, but I think that the most likely outcome if T-Mobile goes up for sale after this deal is blocked would be for somebody like Century Link to acquire it so as to not be limited to reselling somebody else's service.

Re:Doesn't the consumer lose regardless?

[swb]

How about Google buying it? Or maybe not even Google, but a private equity syndicate led by Brin, et al and other like-minded technology people, with someone brought it to run it as a "not evil" company.

Other less palatable concepts are Comcast buying it; I get a full court press from Comcast sales droids for phone and they always seem slightly annoyed that I'm all cellular, this would allow them into all voice markets. I'm not saying this is a "good" idea but it would be something of a business fit.

Re:Doesn't the consumer lose regardless?

[postbigbang]

These are all chess moves by monopolies that can't deal with competition. The game is so small that they're scared to death at what might happen.

First, Sprint has NO MONEY and won't be able to raise enough debt to acquire T-Mobile, even if Deutsche Telekom GAVE IT TO THEM. Sprint has no GSM experience, and they'r desperately wound up in trying to deliver 4G/LTE.

Second, Verizon wants this to happen so they can justify their acquisition of SPRINT, who is the only other CDMA carrier of note in the world.

This is all about empires, and Verizon's protecting their ability to have one.

Re:Doesn't the consumer lose regardless?

[todrules]

And they didn't step up to the plate in the end. AT&T did with a great offer. Sprint just got outplayed.

Re:Doesn't the consumer lose regardless?

[PoopCat]

Option 3: All current TMO customer purchase enough shares (collectively) to block any such buy-out.

Re:Doesn't the consumer lose regardless?

[arth1]

The funny thing is that T-Mobile used to be affiliated with Sprint.
Global One Communications was a conglomerate of Sprint, Deutsche Telekom and France Telecom, and T-Mobile and Orange trace their roots there.

T-Mobile USA, on the other hand, is basically the old PN Voicestream network, which was bought up by T-Mobile, a subsidiary of DT, and has little to do with T-Mobile, except the current ownership.
AT&T buying T-Mobile USA is really AT&T buying the remains of Pacific Northwest that it hasn't already sucked up and reincorporated like a Terminator robot.

Confused yet? Not after the next episode of Telesoap!

Re:Doesn't the consumer lose regardless?

[Hsensei]

Sprint has no GSM experience....

Sprint purchased Nextel who was running a GSM network.

Re:Doesn't the consumer lose regardless?

[StikyPad]

I think Google would be subject to antitrust investigations as well, since they'd have vertical integration from the OS to the hardware (potentially) to the service. It would be very tempting to leverage this position, and could even be considered negligent if they didn't, which would open them to shareholder lawsuits.

Re:Doesn't the consumer lose regardless?

[LifesABeach]

Ya, like your rumor source has access to what any of the Telco's do or consider. I believe it; not.

Translation

[GameboyRMH]

We're ready for less competition! Bring it on!

Re:Translation

[AngryDeuce]

It surprises me that these corporations don't just say stuff like that at this point. They own our government, and the vast majority of people don't even give a shit. Why be coy? There are no repercussions anyway.

Re:Translation

[poofmeisterp]

McAdam was also heard before the conference saying, "It would be nice to have a larger portfolio to purchase later if, you know, we want to do that.... whenever. I'm just sayin'." /humor

Re:Translation

[Xacid]

GOOD CALL.

That's essentially what I got out of it. There's no way consumers will win from this deal.

I wrote my congressmen when this first came to news and got a reply recently:

Thank you for contacting me to express your opposition to the proposed acquisition of T-Mobile USA by AT&T. I always appreciate your input and the opportunity to share my thoughts with you.

As you may know, on August 31, 2011 the Department of Justice filed an antitrust lawsuit against AT&T placing the matter before a United States District Court. A hearing has been set for September 21, 2011 in the federal court to discuss the status of the case. While I am not aware of legislation having been introduced that confronts this issue, I will certainly keep your thoughts in mind should there be any relevant bills proposed in the future.

Again, thank you for writing me on this important issue. If I can ever be of assistance, please do not hesitate to contact me or a member of my staff.

Re:Translation

[ILongForDarkness]

We're ready for less competition AND the competition playing around for 5 years or so trying to get their merger sorted out while we roll out 4G :-)

Re:Translation

[trum4n]

I believe if you trace the history of Verizon was Bell Atlantic. AT&T's roots are Bell Southwest. Any red flags here? Why worry about competition when your brothers? The only real competitor is Sprint. If they get T-Mobile married in to the family, that is.

Re:Translation

[rvw]

We're ready for less competition! Bring it on!

And merging means no extra bandwidth, so what problem does it solve?

Re:Translation

[trum4n]

Found Sauce: http://en.wikipedia.org/wiki/Bell_Operating_Companies#Subsidiaries_and_Bell_operating_companies_today AT&T became AT&T and Verizon.

Re:Translation

[Captain Spam]

Alternate translation: "We're planning on buying out Sprint in a few months, so we hope this doesn't cause any problems for us then."

Re:Translation

[hedwards]

Easy, with the increased costs and decreased customer service, they'll probably have fewer users competing for scarce bandwidth.

Re:Translation

[swillden]

It surprises me that these corporations don't just say stuff like that at this point. They own our government, and the vast majority of people don't even give a shit. Why be coy? There are no repercussions anyway.

When the conclusions logically drawn from your premises don't match observed behavior, it's a good idea to check your premises.

Re:Translation

[GameboyRMH]

If you can get into industry conferences you'll hear them do exactly this. An AT&T exec was famously heard to say something along the lines of "we're locking down the Internet and setting up toll booths" at such a thing. That was in the mid-2000s.

Re:Translation

[GameboyRMH]

Whoa, mod parent Interesting.

Re:Translation

[poetmatt]

good point. there are actually giant repercussions, and stifling business is what causes a lack of economic growth, which in turn leads to a lot of why areas have very poor financial forecasts (bankruptcies in europe), etc.

Oppressive monopolies are not good for financial health of any country.

Re:Translation

[compro01]

Here's a nicer graphical version.

http://www.freepress.net/files/att_history.jpg

Re:Translation

[roman_mir]

What does it mean in this case - less competition?

You think AT&T and T-Mobile is not going to try and undercut Sprint? Why?

If they try to undercut Sprint, then it's good - it's going to force Sprint into MORE competition.

If instead they try to organize a cartel, it won't work. Oil cartels don't work, nobody wants to stick to their quotas, there is more money to be made by selling beyond quotas.

If they do set prices that are too high, this is just invitation for more competition from other new directions. Google may enter this market too, it's not unlikely at all, now that they own Motorola.

Re:Translation

[poofmeisterp]

Good dirt. Thanks! Your points +1, my trust for the biggest wireless companies -10^3.

Re:Translation

[GameboyRMH]

I'm pretty sure there is some kind of cartel-like arrangement going on already. Look at how the telcos all do things that screw the customer at the same time: jack up SMS rates, impose data limits, block tethering, all conveniently happened around the same time on all carriers.

And tell OPEC or DeBeers their cartel doesn't work. Remember to yell, it's hard to hear when you're swimming in a pool of cash.

Re:Translation

[roman_mir]

OPEC doesn't work as a cartel. They are selling above their quotas, it makes no sense for them not to sell. The higher the prices the more capacity they try to bring on line, but there is no more capacity to open up.

Today's gas prices are lowest in history of USA. You can buy a gallon of gas for 10 cents.

Of-course you need a dime that was minted prior to 1965 and had silver in it.

Re:Translation

[roman_mir]

Price fixing is a stupid idea, it doesn't work for cartels because it makes them more money to bring in more customers, so they come up with plans that undercut whatever prices they might have otherwise 'fixed' upon.

Except for that, if there is unfilled demand there will be competition, unless of-course government prevents competition, and it likes to do that.

Re:Translation

[roman_mir]

Oh, by the way, it's true about DeBeers - they are an actual successful cartel.

However that's because nobody cares about their products enough, and there is real competition, it's a different technology, it's called cubic zirconia, you may want to check it out before you waste your money on whatever 'forever diamonds'. Except for cubic zirconia there are also artificial diamonds.

Re:Translation

[DinDaddy]

I was thinking insightful. That was my take on seeing the headline.

Re:Translation

[elsurexiste]

My thoughts exactly. :)

Re:Translation

[roman_mir]

Sure, some companies always try to do that, it only makes sense for them to do so. However government involvement ensures that there will be a monopoly, not the other way around.

The market figures out its ways around cartels, for example OPEC can't do anything about its members selling more than their quotas, simply because it's so lucrative. What are you going to do? The only thing to do is start a war. Well, only government can do that - so there we have a few of those wars happening, Iraq, Libya.

However without government wars do not start and the markets for cellphones are not the kind that wars start over. AFAIC the market figures out a way around it, for example VOIP.

Re:Translation

[GameboyRMH]

Today's gas prices are lowest in history of USA. You can buy a gallon of gas for 10 cents.

Of-course you need a dime that was minted prior to 1965 and had silver in it.

Wouldn't help, you'd still be on the 3rd biggest price spike in the last half-century:

http://www.fintrend.com/inflation/inflation_rate/Historical_Oil_Prices_Chart.asp

Re:Translation

[EvilBudMan]

I think AT&T DOES need more spectrum BUT it should be done another way as that leaves ONE GSM provider in the US. I just like GSM better than CDMA.

Re:Translation

[roman_mir]

That's what I am talking about, it's not a spike in actual price of oil. The price of fuel at a gas pump is lowest ever in real money.

The Fed is going to print 400Billion USD more, will do all sorts of tricks, will bail out banks again by buying out more mortgage backed securities, will now try to suppress long term interest rates, all of this is inflation. Money printing. Setting extremely low cost of borrowing, all of this is inflation.

So in a depression, that USA and other countries are finding themselves in, the prices in real money are going down, because there is less production, so there is less consumption in real terms - that's deflation.

The Fed and governments of the world are filled with Keynesian charlatans, who only know have one remedy for everything: print more money. Of-course it forces prices to go up in nominal terms (in federal reserve notes.) But actual prices are going down.

Now, the real problem in USA and the West for cell phone companies and for all other companies is the same - there is no way to make money in such insane inflationary environment and in an economy that has no production capacity.

So how do these cell phone businesses can even STAY AFLOAT in this environment?

Never mind that they are making billions of dollars - that's nominally, and that's not money coming from the Federal reserve discount window to them. Sure, the Fed subsidizes consumption of US residents by pushing interest rates down.

Imagine that the government is now passing (or passed) a measure that will force Freddie and Fannie to provide or insure loans that will be given to people not based on any equity they have in their property, but they will have to give you loans that are up to 135% of whatever the nominal price of your house is.

So you can get a mortgage for your house, that is larger than your house is worth.

I say take it and RUN. Take it and leave, skip. Go buy some silver or gold or whatever you want with that cash and don't come back. Rent instead.

But for a phone company to try and make actual working business, or for any company for that matter..... it's a losing proposition.

I used to work for a company called Symcor in Toronto a decade ago, they were a check processing and check/statement printing company for three Canadian banks. Eventually they came into US market as well, buying out the smaller competitors.

Do you know WHY the were able to do this in a shrinking industry? (yes, the industry of check processing is/was shrinking). Because they are an economy of scale.

They have the capacity to add processing for smaller banks cheaper than any small processor, and can keep check processing going, while a small company would have just gone under.

I believe this is the same problem right now for other companies in USA - the phone business is no exception. What is USA producing?

As I said earlier - trading is about comparative advantage. You want to exchange the goods you produce for other people's goods. It's not about pieces of paper. So if you produce something, you take the money from people who ALSO PRODUCE something.

If they produce nothing, then their money is no good. That's why taking money from 'rich', who invest it into production and giving it to be spent for consumption on consumer goods to 'poor' is detrimental to the economy, it's not good money, it's a net negative effect. Those people who got the money for free didn't add anything to the productive capacity, so their money only subtracts from economy, it doesn't add to it.

So for a phone company to take your money, that is printed by the Fed and given to you at low or now interest, while you are producing nothing of value that the phone company could use in return for their products/services is a net loss for the phone company.

For them it makes no sense to continue,

Re:Translation

[GameboyRMH]

I think everyone likes GSM better than CDMA, except the carriers of course.

Re:Translation

[roman_mir]

By the way, the competition, where is it supposed to come from? As I mentioned in the other comment above, there is no way to make money in USA because investments are wiped out with government inflation, but what about lending?

The Fed came out with $400Billion USD stimulus again, but they are going to buy long term bonds, trying to push long term yields down. 10 year is at 1.77% and 30 year is at 2.684%. The lowest 30 year has been was in 2008, it was 2.5%. The 10 year hasn't been this low since 1940s.

But gov't also now has come out with a directive to Freddie and Fannie to start guaranteeing mortgages to people up to 125 or 135% of the home value, so even if you have no equity in the house, you can get a mortgage that is 125 or 135% of the value of the house - they are trying to make consumers consume again (as I said in the comment above, that's destructive to the market.)

So home mortgages will be refinanced, Freddie Fannie will guarantee them to people who don't have any equity. This refinancing will be under 4%, maybe 3% for many. HOW ARE BANKS GOING TO SURVIVE THIS?

Banks are going to go broke! This is crazy, the banks cannot lend any money because of how low the interest payments are at this point, their books is filled with debt that is long terms, low yielding, this is going to be even longer term even less yielding. All these banks are going to go bankrupt unless there is another QE (3). If Fed doesn't come out with that, then there will be another TARP (2).

Of-course there is no way to start a business unless you have your own money saved, but as I said earlier, you can't save money in US, inflation by the Fed doesn't let you do it.

The country is in this box - can't save money, can't borrow money from banks without forcing bank bankruptcy or another QE or another TARP, which WILL make economy even weaker!

So what competition can we talk about here? How can any company survive this, AT&T, T-Mobile, they have to consolidate at this point.

Verizon may not get it, but they will have to consolidate with others just to survive at this point or they'll have to leave US market.

Re:Translation

[bill_mcgonigle]

Yup, me three. Right on, right on.

Cellular telephony motto: "there can be only two." AT&T learned the hard way about the problems with "one".

Re:Translation

[sjames]

It's kinda like when you tell the teacher you have a headache and she "just happens" to put a bottle of aspirin on her desk and look away. We all know what's up, including that she needs some level of plausible deniability.

Same deal here. They don't legally and legitimately own the government. Their ownership is more defacto.

If government officials, and especially the courts admit that the Constitution is null and void, then their only means of demanding payoffs from their corporate masters will evaporate.

Re:Translation

[RoFLKOPTr]

And related: ATT History on Colbert Report

Lowell should read the news more often

[MetalliQaZ]

Looks like he hasn't been keeping up with the latest reports; indicating that AT&T is secretly trying to SELL spectrum to smaller operators in order to get support for the merger. Sounds like they have plenty already. (this was discussed on /.)

Re:Lowell should read the news more often

[alen]

spectrum is local so AT&T is probably selling off spectrum that won't be used nationwide

Re:Lowell should read the news more often

[Desler]

Good for at&t? And if it's so important why are they trying to sell off spectrum? Apparently it's not as pressing an issue as we are being lead to believe if they can afford to sell some off.

Re:Lowell should read the news more often

[Wireless Joe]

It's possible AT&T is trying to sell spectrum in sparse markets, where smaller carriers have a better business model. If AT&T can pick up 10mhz in New York, it's worth the price to buy and re-sell 10mhz in Killdeer, North Dakota.

Re:Lowell should read the news more often

[AngryDeuce]

AT&T's argument is that the amount of mobile devices and large bandwidth data users could grow by up to ten times the current amount in under five years.

With the ridiculous bandwidth caps and tethering blocks? Yeah, right.

I have a feeling we're going to see data usage plateau. I know I've curtailed my data usage heavily since Verizon instituted the 2GB cap.

Re:Lowell should read the news more often

[poofmeisterp]

Isn't that the truth....

The truest importance is subconscious and used in marketing constantly. As long as the buyer believes they are on the "fastest network in the country/world", they are superior. The actual performance on your individual phone may vary. No warranties expressed or implied. See ad for details. etc etc etc.

Re:Lowell should read the news more often

[dkleinsc]

You're assuming that Lowell doesn't realize he's wrong. Much more likely, he's completely full of it, and saying what he thinks will benefit his company to say because that's what's best for him and his shareholders.

Re:Lowell should read the news more often

[afidel]

Of course he is, less competition in the market will lead to higher ARPU and lower churn. Even if they keep exactly the same number of subscribers Verizon wins from an AT&T T-Mobile merger and they don't have to spend any capital to get it done meaning for his tenure at Verizon he'll probably outperform AT&T.

Re:Lowell should read the news more often

[Coren22]

. I know I've curtailed my data usage heavily since Verizon instituted the 2GB cap.

You moved to Verizon after they removed the unlimited plan? Also, you haven't realizes that there is a 5GB cap on VZ, not 2GB?

VZ hasn't forced anyone but new customers onto the cap, I still have unlimited.

Re:Lowell should read the news more often

[tsotha]

Sell spectrum where? North Dakota? AT&T is already out of spectrum in some of the larger markets.

This makes perfect sense

[dkleinsc]

It would give Verizon the go-ahead to gobble up Sprint in, say, a hostile takeover, leaving only AT&T and Verizon on the playing field. A 2-company oligopoly can price gouge more easily than a 4-company oligopoly.

Re:This makes perfect sense

[egranlund]

Sounds about right.

Re:This makes perfect sense

[TheSpoom]

And then AT&T just has to buy Verizon and it's back to Ma Bell for everyone!

The difference, of course, is that this time they'll own the justice department as well.

Re:This makes perfect sense

[poofmeisterp]

Nummy nummy nummy, I got spectrum in my tummy. :>

Sorry.. it was right there.

Re:This makes perfect sense

[rabun_bike]

And don't forget that Verizon is also just a former Baby-Bell. For those that would like a eye-popping account of the last 120 years of Ma Bell's straggle hold on US technological innovation read the book "The Master Switch" by Tim Wu.

Verizon Communications Inc. (NYSE: VZ, NASDAQ: VZ) is a global broadband and telecommunications company and a component of the Dow Jones Industrial Average. It started in 1983 as Bell Atlantic (based in Philadelphia) with a footprint covering New Jersey to Virginia and emerged as part of the 1984 AT&T breakup into seven "Baby Bells." In 1997, Bell Atlantic merged with another Regional Bell Operating Company, NYNEX, based in New York City with a footprint spanning from New York to Maine. The combined company kept the Bell Atlantic name. In 2000, Bell Atlantic acquired former independent phone company GTE, and adopted the name "Verizon", a portmanteau of veritas and horizon,[3] which rhymes with horizon. The company's headquarters are located in the Verizon Building at 140 West Street in Lower Manhattan, New York City.[4]

Re:This makes perfect sense

[geekoid]

That's the same thing people said about Ma Bell..yet they got broke up.

Please stop the 'corporation own the government' idiocy. It was tiring to here people say it 40 years ago, and it's tiring now.

Re:This makes perfect sense

[compro01]

That's the same thing people said about Ma Bell..yet they got broke up.

Yes, after having a monopoly for about 60 years.

Re:This makes perfect sense

[compro01]

Freepress.net has a lovely illustration of the history of the baby bells.

http://www.freepress.net/files/att_history.jpg

Re:This makes perfect sense

[StikyPad]

And then essentially reforming over the next decade like the T-1000.

Re:This makes perfect sense

[z_gringo]

MCI should appear in that chart well before WorldCom 2003.

Verizon Sprint Merger?

[ox01a4]

Looks like Verizon is posturing for its plan to merge with Sprint. No no mergers are the only way we can keep up with customer demand. I mean you can't expect us to spend profits on upgrading our network. That would be silly.

Re:Verizon Sprint Merger?

[dirtyhippie]

Not so much if you RTFA. Verizon seems much more interested in grabbing new slices of wireless spectrum from the Government.

of course they do

[jsepeta]

How can Verizon buy Sprint if AT&T isn't allowed to buy T-Mobile?

it is good for Verizon

[Anonymous Coward]

It is good for Verizon, because it gets rid of another competitor. They can raise rates more without another decent competitor to keep them in check.
They also figure, probably rightly so, that a lot of TMobile customers will leave when it happens, giving Verison more.
Then ATT will continue doing the only thing they know how to do, and that is to keep getting worse than they already are, which will drive even more customers away with fewer competitors for them to go to.
More and more customers for Verizon all around, with higher and higher rates.
Win win.

Re:He's Right

[denis-The-menace]

Then the industry will have to be regulated, Again.

Re:In case you had any doubt...

[Fujisawa Sensei]

They are also looking forward to an in influx of former T-Mobile customers.

Re:Proof they need more regulations

[Xacid]

Never trust industries to regulate themselves when it comes to anything.

FTFY

Verson's turn.

[andydread]

Hey Lowell McAdam, You are saying that in order to expand you and AT&T needs to buy other companies to get more spectrum. So when they purchase T-Mobile and you purchase Sprint(for more spectrum) of course. What happens to the marketplace when only two players are left?. What happens to customers ability to chose? What happens to the choices of phones? Remember when iPhone was the only decent smartphone AT&T offered? What happens to unlimited wireless? Since AT&T decided to drop unlimited and you decided to follow suit leaving Sprint as the only true unlimited carrier. I don't buy your spectrum argument. I think you are licking your chops at the ability to drive up prices due to lack of consumer choice and nickel and dime us to death with overage charges. We do not want a duopoly on communications in America.

Re:Verson's turn.

[poofmeisterp]

...What happens to the marketplace when only two players are left?. What happens to customers ability to chose? What happens to the choices of phones?...

Pretend I'm Lowell or any major shareholder...

"Doesn't matter because I will sell my stock shares off before any government wireless regulation or antitrust settlements reach their point of de-fruition."

Re:Verson's turn.

[andydread]

LOL ain't that the truth.

Re:Verson's turn.

[EvilBudMan]

Sprint actually has plenty of spectrum but they are not out in the country and really neither is T-mobile. I believe very few people had smart phones when those unlimited plans were offered.

Really what would be best, would be if Sprint was a credible competitor to Verizon and T-mobile to AT&T but really it's just AT&T & Verizon. Verizon and Sprint are CDMA. AT&T and T-mobile are GSM. Verizon's 4G LTE most people that live out in the country will never see just like AT&T's 4G though Verizon may be a little ahead. HSDPA is faster than EvDO IMO AND that's all you are going to get plus a few wifi hotspots if you don't live in the city.

I've had both and I know.

With tablets coming along I think all carrier need more bandwidth. If AT&T had one more frequency, they could put the data down two channels, and the voice on another. I mean I can see them buying T-mobile for that alone but it would also make them the only carrier that has GSM in the US worth mentioning and that's scary but Verizon not caring, well maybe 4 providers are too many as well. It could be fine if Verizon and AT&T compete and don't make some backroom deal.

Probably the best way to resolve this would be a Sprint and T-Mobile merger since T-mobile really doesn't want to be here and then give an extra frequency to AT&T so all 3 have the same. The way it is now merging T-mobile and AT&T would probably devastate Sprint. Then Verizon would buy that up. Then you have 1 CDMA carrier and 1 GSM so when you change phones, well better get a new contract.

Merge then Bust 'em

[what2123]

I say we let them merge, then bust AT&T up again into 7 little companies to see who gobbles who up. The prices for competition will be good for about 5 - 6 years and we will all get to see some good commercials and not to mention some really cool logos! It's the new way of entertaining the rich and the poor can sit helplessly while they are brainwashed into believing one company is actually better than another...

Spectrum is not what's holding AT&T back

[ktappe]

AT&T has plenty of spectrum. What they don't have is connective infrastructure. I constantly have AT&T signal but data just won't go through because the towers' routers are overloaded. AT&T needs to take the billions it is trying to spend buying T-Mobile to add bandwidth.

Re:Spectrum is not what's holding AT&T back

[esocid]

AT&T has plenty of spectrum. What they don't have is connective infrastructure. I constantly have AT&T signal but data just won't go through because the towers' routers are overloaded. AT&T needs to take the billions it is trying to spend buying T-Mobile to add bandwidth.

But how do you expect ATT to make money? Investing in infrastructure costs money. Doing nothing is free.

Re:Spectrum is not what's holding AT&T back

[bill_mcgonigle]

Yeah, AT&T has said the merger is about getting more towers because the FCC won't permit new ones fast enough for AT&T to stay competitive.

Re:Doesn't anyone remember Sen. Sherman?

[rkhalloran]

And look at what happened when they busted Ma Bell up, two of the Baby Bells ended up assimilating most of their sibs and the legacy LD landline providers: Bell Atlantic/NYNEX + MCI --> Verizon, Southwest Bell/Pac Bell/Ameritech/Bellsouth + legacy-Ma --> "The New AT&T" (ptui). Mountain Bell, er, US West, was bought up by Qwest during the dot-com bubble, now being acquired by CenturyLink.

There's something to be said for economies of scale, the problem is the laissez-faire regulatory structure that's let them and the cable broadband providers pretty well bend us all over the last 15-20 years as the legacy landline business dries up in favor of mobile and VOIP.

Re:In case you had any doubt...

[toadlife]

I would guess that T-Mobile customers are more likely to move to Sprint as their rates are comparable to T-Mobiles. Verizon's rates are the highest of any carrier.

(I'm a former T-Mo customer that moved to Sprint in June)

Of course he would defend it...

[Polo]

...After all, they're next!

(and then finally, AT&T will be back together)

If you let them buy Tmobile,...

[Anonymous Coward]

you cannot stop us from buy up Sprint.

What the Verizon Chief really wants to say

[Culture20]

"With less competition across the board, we can all charge higher prices. It's a win-win!"

One more expense to eliminate

[thoughtlover]

Honestly, with the cost of internet (I have only one choice in my city of 200K) Comcast charges me, plus the third-party applications to allow telephone calls to wi-fi devices (skype, talkatone, etc.) and free texting, I will eliminate my cellphone before most other expenses. No, I don't need to be accessible all the time and kind of loathe that aspect of modern society, as of late. If you really want to get a hold of me, you know what to do.......

Of course he does

[0xdeadbeef]

Where else will all the T-Mobile customers go?

Sprint? Stay with AT&T? lol

Of course they support it.

[mrquagmire]

Because that then opens the door for Verizon to purchase Sprint so that there will be even LESS competition.

Then VZW buys Sprint or Sprint goes under.

[jensend]

"Collusion and price-fixing are so much friendlier with two. :)" - Lowell McAdam

Re:Doesn't anyone remember Sen. Sherman?

[dgatwood]

Ah, but you're not seeing the whole picture. The benefit of the breakup was that AT&T (the long distance carrier) was separate from the wire carriers for a very long time, and that to this day, the wire services are required to allow competitors to use their lines for other services.

An ideal breakup of AT&T and Verizon would be similar: the towers would be owned by two nationwide companies that are both forbidden to lease access to individual customers, and the customer base would be divided among a crapload of companies that initially own the customer base from a particular region (divided up so that each covers the entire country in small, alternating pockets).

This would create dozens of cell provider companies that would immediately compete with one another on a nationwide basis, and two tower providers that could compete for those cell providers' business alongside Sprint and T-Mobile.

And down the stretch they come!

[ThatsNotPudding]

Immoral corporate greed and inane douchebaggery headed for a photo finish!

Price fixing.

[SeNtM]

Its easier to conspire with one company than with two when fixing prices and overcharging for services...

As a Verizon customer, I often wonder why my $99/mo plan costs me $160...

Re:Doesn't anyone remember Sen. Sherman?

[Miamicanes]

AT&T and Verizon might be Bell's children, but their cultures and long-term business strategies are about as different as you can get. AT&T's long-term strategy is to abandon wired infrastructure, and spend as little money as possible expanding capacity in favor of capping users into submission. Verizon's long-term strategy is to run fiber everywhere, costs be damned, and charge top dollar for a premium service. In a very real sense, when the original AT&T got broken up, SBC inherited the cheapskate Soviet-style bureaucrats, and Verizon inherited the execs who worked at the bleeding edge of the front lines & believed in making cool things happen, costs be damned.

In more historical terms, SBC's management grew from the folks who did their best to talk rural customers into sticking with party lines (because it meant they didn't have to run more copper out to BFE). Verizon's management grew from the folks whose earlier bosses made satellite communication viable, and made live TV press conferences in the middle of nowhere possible (at staggering cost, absorbed by everyone since they were still a monopoly and could get away with it) way back in the 50s and 60s.

That said, both companies are control freaks... an attitude they both inherited from the old AT&T. The sad thing is, they're control freaks for the sake of being control freaks. Obviously, they want to make more money, and know they can do it by trying to create walled content gardens and crippling users' phones to steer them towards premium services, but when you really dig down to it, they'd do it even if cost and profitability were complete non-issues, just because that's how they've *always* been.

No

[StillNeedMoreCoffee]

"The current telcos need more wireless spectrum to continue expanding and operating efficiently so they have resorted to acquiring other companies."

Or give them all the same restrictions do they can battle it out on price and not on coverage. A level playing field would let competition work better.

Im not suprised

[kelarius]

This is Verizon basically saying "We want to be able to "merge" with Sprint in a few years so if we fight them on this they're gonna fight us on that"

Not disinterested?

[dhasenan]

Of course Sprint isn't disinterested! They're bringing suit, which requires that they have standing. In other words, if they *were* disinterested, then the judge would have thrown out the case.