AT&T Gobbles T-Mobile—Becomes Largest Wireless Co by Far

By Patrick Morgan | March 21, 2011 10:01 pm

What’s the News: Yesterday, AT&T announced plans to buy T-Mobile USA for $39 billion from parent company Deutsche Telekom, making the new behemoth the hands-down largest wireless company in the United States. Though AT&T touts this merger as good for everyone, some technology writers, such as GigaOM’s Om Malik write that “it’s hard to find winners, apart from AT&T and T-Mobile shareholders.”

What’s the Context:

  • AT&T says the combined skills of the two companies will improve high-speed mobile broadband service and extend coverage to more rural communities, achieving President Obama’s goal of connecting “every part of America to the digital age.”
  • With T-Mobile’s 33.7 million wireless subscribers, AT&T will have 129.2 million subscribers, dwarfing Verizon Wireless’s 94.1 million. So begins a new chapter in the companies’ long-term rivalry, as previously covered in 80beats.
  • T-Mobile is the fourth-largest mobile provider in the U.S., and offers cheaper plans than category leaders AT&T and Verizon.

Not So Fast: The company merger is still awaiting regulator approval. Some argue that the bigger AT&T will hurt smaller companies like Sprint and even larger ones like Google. “Sprint and T-Mobile often stood against AT&T and Verizon on a variety of regulatory issues, so if AT&T succeeds, Sprint will stand alone on special access and other issues,” writes Malik. With more power, it’ll be easier for AT&T to “impose its own will” on what services and apps are placed on Android smartphones. If the FCC or Justice Department agree that the acquisition will give AT&T too much power or lead to higher prices, they may veto the deal.

Image: AT&T

CATEGORIZED UNDER: Technology
ADVERTISEMENT
NEW ON DISCOVER
OPEN
CITIZEN SCIENCE
ADVERTISEMENT

Discover's Newsletter

Sign up to get the latest science news delivered weekly right to your inbox!

80beats

80beats is DISCOVER's news aggregator, weaving together the choicest tidbits from the best articles covering the day's most compelling topics.
ADVERTISEMENT

See More

ADVERTISEMENT
Collapse bottom bar
+