AT&T to buy T-Mobile

  • Posted: 20 March 2011 04:35 PM

    http://www.cnbc.com/id/42181945

    What are the implications to AAPL with this news?

         
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    Posted: 20 March 2011 04:49 PM #1

    A 4G network and more iPhone sales.  grin


    :apple:

         
  • Posted: 20 March 2011 04:49 PM #2

    cranium - 20 March 2011 07:35 PM

    http://www.cnbc.com/id/42181945

    What are the implications to AAPL with this news?

    Once the deal goes through (assuming it’s allowed to), Apple can finally service T-Mobile customers, providing ATT subsumes the TM network and brings it up to the same technology as their own. The limitations that current T-Mobile jailbroken/unlocked iPhone users have will vanish. And we will all live happily every after…

         
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    Posted: 20 March 2011 05:47 PM #3

    T-Mobile’s 34 million subs may soon be able to buy iPhones but they will run on AT&T’s groaning network. TMO’s 3G is not iPhone compatible. The consequence however is that iPhone will indeed be available to almost all US mobile phone users.

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  • Posted: 20 March 2011 06:08 PM #4

    asymco - 20 March 2011 08:47 PM

    T-Mobile’s 34 million subs may soon be able to buy iPhones but they will run on AT&T’s groaning network. TMO’s 3G is not iPhone compatible. The consequence however is that iPhone will indeed be available to almost all US mobile phone users.

    I administer a telecommunications network with devices that run on both AT&T and T-Mobile. Both sets of devices use the same towers. There is no substantial difference other than a different IP range and some frequency settings.  My wife’s iPhone is currently running on the T-Mobile network.  Devices now on the T-Mobile network should see no difference, other than being able to share the bandwidth with the AT&T devices.

    [ Edited: 20 March 2011 06:15 PM by Zeke ]      
  • Posted: 20 March 2011 06:10 PM #5

    A deal such as this may have been inevitable and really leaves Sprint dangling. We can thank the popularity of the Apple iPhone and the market clout of both Verizon and AT&T for this deal. Long-term it fits AT&T’s strategy. Deutsche Telekom may have the decided the increasing investment to remain competitive in the US market was attractive and it was best to excise as much money as possible and exit the market.

         
  • Posted: 20 March 2011 06:23 PM #6

    Pretty sure this will result in vastly increased, and unified, coverage for all existing TM and ATT users.

    People complain about ATT now.  ...You should have tried them before they added-in Cingular’s network. YIKES!  May be hard to believe but they really improved after that.

         
  • Posted: 20 March 2011 06:35 PM #7

    I think we need to hold our horses on this.  This is going to have so much regulatory scrutiny that a deal like this could take 6-12 months to complete (if not longer)...  You’re talking about the largest network (I believe AT&T took that title from Verizon in the past quarter?) in the US taking over the fourth largest.  In fact the more I think about it, the less certain I am of this ever coming off.  And if it does, woe betide the poor US mobile telephony customer.  Americans already pay exhorbitantly high mobile service fees for fairly average services in comparison to the rest of the developed world.  I don’t see how reducing competition is going to help that at all…

    My knowledge of the US anti-trust and takeover regulations is not that firm, however, in the UK the law is fairly implicit that no company can acquire another if it will give it in excess of 25% market share.  I don’t know the full subscriber figures for the top four, but I am assuming T-Mobile and AT&T together will have more than 25% of the market?  If that’s the case, then if the US is anything like the UK (and I have no idea if it is) then this deal would not be allowed to go through.  However, the competing view on this is that the lawyers and i-bankers would not advise AT&T or Deutsche Telekom to go ahead with such a costly process of initiating a transaction if they didn’t think they had a compelling enough legal case to make at any competition commission hearings etc.

    Should be fun to watch this one unfold…

         
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    Posted: 20 March 2011 06:38 PM #8

    Om Malik of GigaOm bemoans the merger announcement

    wo wo wo

    Consumers, handset makers, sprint, network equipment suppliers and Google are cited as losers.

    It doesn?t matter how you look at it, this is just bad for wireless innovation, which means bad news for consumers. T-Mobile has been pretty experimental and innovative ? it has experiment with newer technologies such as UMA, built its own handsets and has generally been a more consumer centric company. AT&T on the other hand has innovation of a lead pencil and has the mentality more suited to a monopoly ? a position it wants to regain.

         
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    Posted: 20 March 2011 06:44 PM #9

    asymco - 20 March 2011 08:47 PM

    T-Mobile’s 34 million subs may soon be able to buy iPhones but they will run on AT&T’s groaning network. TMO’s 3G is not iPhone compatible. The consequence however is that iPhone will indeed be available to almost all US mobile phone users.

    Believe the Infineon chipset supports pentaband so maybe iPhone 5 will add the additional frequency.  Assuming there is room for an extra amp on the board.  They didn’t make the change for iPad 2 so we will have to wait as see how ATT repurposes the frequency.

         
  • Posted: 20 March 2011 06:46 PM #10

    Some good info on the potential deal can be found here:

    http://blogs.wsj.com/deals/2011/03/20/att-buys-t-mobile-heres-why/

         
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    Posted: 20 March 2011 06:51 PM #11

    I wonder if AT&T would really be stupid enough to buy T-Mobile USA or try to if it thought the DOJ would block the merger.

    As far as choice and price are concerned…uh…cost savings?  Really?  Cheapest individual 500-minute smartphone unlimited data plan I can find is $80/mo.  That doesn’t strike me as being very cheap.  I mean sure, unlimited text, but we all know text messages are a profit-machine farce of “value adding”, usefulness aside.  IIRC AT&T iPhone customers, before data caps anyway, could get their individual monthly bills around that same price point, albeit without the benefit of text messages.

    The other thing:  T-Mo USA is said to be a sinking ship of sorts.  That would tend to have an impact on monthly subscriber fees. 

    Luckily, Apple doesn’t really stand to lose if the T-Mo merger goes through.  The #1 choice for AT&T and possibly-soon-to-be-dissatisfied-T-Mobile jumpers is Verizon.

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    Posted: 20 March 2011 06:53 PM #12

    Message boards at Yahoo Finance for ATT (for what its worth) say that ATT stock will take a hit.

         
  • Posted: 20 March 2011 07:03 PM #13

    JonathanU - 20 March 2011 09:35 PM

    I think we need to hold our horses on this.  This is going to have so much regulatory scrutiny that a deal like this could take 6-12 months to complete (if not longer)...  You’re talking about the largest network (I believe AT&T took that title from Verizon in the past quarter?) in the US taking over the fourth largest.  In fact the more I think about it, the less certain I am of this ever coming off.  And if it does, woe betide the poor US mobile telephony customer.  Americans already pay exhorbitantly high mobile service fees for fairly average services in comparison to the rest of the developed world.  I don’t see how reducing competition is going to help that at all…

    My knowledge of the US anti-trust and takeover regulations is not that firm, however, in the UK the law is fairly implicit that no company can acquire another if it will give it in excess of 25% market share.  I don’t know the full subscriber figures for the top four, but I am assuming T-Mobile and AT&T together will have more than 25% of the market?  If that’s the case, then if the US is anything like the UK (and I have no idea if it is) then this deal would not be allowed to go through.  However, the competing view on this is that the lawyers and i-bankers would not advise AT&T or Deutsche Telekom to go ahead with such a costly process of initiating a transaction if they didn’t think they had a compelling enough legal case to make at any competition commission hearings etc.

    Should be fun to watch this one unfold…

    You are referring to a US political system that has failed its citizenry on many levels for many years. Any observer of this system knows that a few well placed millions in the right lobby groups can grease this deal of billions. Let ‘em buy iPhones.

         
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    Posted: 20 March 2011 07:06 PM #14

    It’s a cynical viewpoint, but I love the punchline!  Let ‘em buy iPhones! :D

    T may go down on the news, but I can’t see how _AAPL_ would.  Either AAPL will have a higher chance of selling iPhones to current T-Mo subscribers or not.  Net slight positive when you weigh the probabilities.

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    Thanks, Steve.

         
  • Posted: 20 March 2011 07:09 PM #15

    Tetrachloride - 20 March 2011 09:53 PM

    Message boards at Yahoo Finance for ATT (for what its worth) say that ATT stock will take a hit.

    But will AAPL take a jump with a new service provider and a new set of potential customers?  It does bring a new question to my mind.  With AAPL going from $360 to $330 in the course of 10 days, just prior to this announcement, can we surmise that somebody in the hedge fund world saw this coming and worked to tank the stock (and had plenty of ammunition to work with)?  With the amount of financing that had to be arranged, surely the investment banking world was aware of this transaction weeks ago.  Why announce the deal on a weekend with the markets closed?  Are some institutional investors getting their transactions lined up for the market open on Monday?

    Nah!  That would be buying into conspiracy theories.  Couldn’t happen on Wall Street.