AT&T’s proposed acquisition of T-Mobile USA for $39 billion has taken the mobile industry by storm. Together, the two companies are expected to control 80 percent of the US market, far outstripping Verizon and leaving a beleaguered Sprint lagging in third place.
There are many reasons to have mixed feelings about the proposed merger, even if you aren’t a Sprint exec. If the merger passes regulatory inspection by the Federal Communications Commission, decreased competition is expected to limit the number of available smartphone models as well as drive up plan prices. Many jobs will be lost as redundant facilities close down.
However, there are some pros to the merger as well. The increased number of towers will improve service for customers of both phones, especially in densely populated urban areas. Also, if you are a T-Mobile customer, you can expect to get the iPhone in about 12 months, though by that time you’ll technically be an AT&T customer. Users can also expect an increase in 4G coverage. AT&T has promised to expand its 4G LTE network to include 95 percent of the US population as part of the merger with T-Mobile.
This particular buyout is changing the face of the mobile industry, as the market is being increasingly dominated by the Verizon and AT&T duopoly. It is up to the US customer base to decide whether or not it is changing for the better.
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Ari, I think you meant the new ATT/TMo and Verizon will control 80% of the Wireless market. Based on the following numbers I don’t understand how ATT and TMo could even garner more than 40% of the available cell phone subscribers:
ATT: 95 million subs
VZW: 97 million subs
S: 50 millon subs
TMo: 34 million subs
Leap and Metro PCS: 12 million subs
Others have approx 10 million subs
Out of a possible 300 million subs ATT and TMo will have no more than 95 + 34 = 129 million subs, which is 129/300 = 43% not 80%. To make this deal work ATT will most probably have to concede to many concession by the FCC which would put them below 40%.
The new order would look more like this:
1. ATT 125 million subs
2 Verizon 100 million subs
3 Sprint/CLWR 55 million subs
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