T-Mobile is a German wireless services provider, owned by Deutsche Telekom.

It operates
several GSM networks in Europe and the United States. T-Mobile also has financial stakes in
mobile operators in Central and Eastern Europe. Globally, T-Mobile has some 150 million
subscribers,[1] making it the world's tenth largest mobile phone service provider by subscribers
and the third largest multinational after the United Kingdom's Vodafone and Spain's Telefónica. T-
Mobile UK has recently[when?] become part of a joint venture with France Telecom's mobile network
provider, Orange U.K.; together they make the UK's largest mobile operator, calledEverything
Everywhere.

Based in Bonn, Germany, T-Mobile is present in ten other European countries (Austria, Croatia,
Czech Republic, Hungary,Macedonia, Montenegro, the Netherlands, Poland, Slovakia and the
United Kingdom) as well as the United States.

On March 20, 2011, Deutsche Telekom announced plans to sell T-Mobile's U.S.
operations to AT&T, pending regulatory approvals.[2] The proposed deal will have no effect on the
ownership of T-Mobile operations in Europe.

History

In Germany, its home market, T-Mobile is the largest mobile phone operator with
almost 16 million subscribers (As of January 2008), closely followed by its
primary rival, Vodafone. The highly profitable GSM network in Germany is
scheduled to be supplemented and ultimately replaced by UMTS, for which T-
Mobile spent EUR 8.2 billion in August 2000 to acquire one of the six licenses for
Germany.

On July 1, 1989, West Germany's state-owned postal monopoly panned

out, Deutsche Bundespost (DBP) was reorganized, with telecommunications
consolidated in a new Deutsche Bundespost Telekom unit; this was
renamedDeutsche Telekom in 1995, and began to be privatized in 1996.
The analog first-generation C-Netz ("C Network", marketed as C-Tel) was
Germany's first true mobile phone network (the A and B networks, also owned by
the post office, had been previous radiotelephone systems), and was introduced
in 1985. Following German reunification in 1990, it was extended to the
former East Germany.

On July 1, 1992, the Deutsche Bundespost Telekom began to operate

Germany's first GSM network, along with the C-Netz, as
its DeTeMobil subsidiary. The GSM 900 MHz frequency band was referred to as
the "D-Netz", and Telekom named its service D1; the private consortium awarded
the second license (formerly Mannesmann, nowVodafone) chose the equally
imaginative name D2. In 1996, as Deutsche Telekom began to brand its
subsidiaries with the T- prefix, the network was renamed T-D1 and DeTeMobil
became T-Mobil; the C-Netz, in the process of being wound down, was
notrebranded, and was shut down in 2000. In 2002, as Deutsche Telekom
consolidated its international operations, it anglicized the T-Mobil name as T-
Mobile, although sometimes also using the name T-D1 within Germany. It is still
common for Germans to refer to T-Mobile and Vodafone as D1 and D2.

D1 introduced short message service (SMS) services in 1994 and began

a prepaid service, Xtra, in 1997.[3] On April 1, 2010, after the T-Home and T-
Mobile German operations merged to form Telekom Deutschland GmbH, a
wholly owned subsidiary of Deutsche Telekom, the T-Mobile brand was
discontinued in Germany and replaced with theTelekom brand.

[edit]
 T-Mobile

Type Subsidiary of Deutsche Telekom

Industry Communications

Founded 1990

Headquarters Bonn, Germany

Key people Alec Smalle – Chief Executive Officer

Products Fixed and Mobile telephony, DSL, Wireless PDAs, Mobile

Broadband

Employees 36,000

Parent Deutsche Telekom

Website T-mobile.com

a b
Duryee, Tricia (2011-03-20). "AT&T Agrees to Acquire T-Mobile USA for $39 Billion". All Things Digital.
Dow Jones & Company Inc. Retrieved 2011-03-20.

T-Mobile USA is the US-based subsidiary of Deutsche Telekom pending sale to AT&T. Unlike
other T-Mobile properties, T-Mobile USA is not part of T-Mobile International AG. T-Mobile USA is
currently the fourth-largest wireless carrier in the United States and is headquartered in Bellevue,
Washington. T-Mobile USA's market has approximately 34 million customers as of June 2009 and
annual revenue of US$17 billion.[29]

The U.S. T-Mobile network predominately uses the GSM/GPRS/EDGE 1900 MHz frequency-
band, making it the second-largest 1900 MHz network in the United States[citation needed], only behind
Sprint PCS, which uses CDMA technology. Service is available in 98 of the 100 largest markets
and 268 million potential customers (POPS). In September 2008 T-Mobile began rolling out its 3G
network (operating on the 1700 MHz band) to service G1 customers in 14 initial cities. T-Mobile's
UMTS (3G) service is now active in over 30 major US cities and operates on over 15 new
devices.

T-Mobile USA uses the 1700/2100 MHz AWS Band for its 3G network. The carrier states it allows
faster download and upload data speeds utilizing HSPA+ technology, which allows for
simultaneous voice and data. Upgrades to HSPA+ are planned for 2009 through 2010 which may
boost average download speeds from 7.2Mbps to 21Mbps.[30]

T-Mobile Pre-paid service is available within the US. An issue is that web access passwords can
only be reset by SMS, yet the prepaid phone does work outside of the continental USA in limited
instances, such as Hawaii, Mexico, some Caribbean islands, and in the contiguous USA in
Alaska. T-mobile customer service management advises this is by FCC regulation. This is
unusual, since German T-Mobile pre-paid will work anywhere in the world and web accounts can
be managed by email.

The U.S. company was previously known as VoiceStream Wireless or Powertel. In July 2001, the
company was acquired by Deutsche Telekom for US$50.7 billion,[31] and in September 2002
changed the company name nationally to T-Mobile.

On September 17, 2007, T-Mobile USA announced the acquisition of SunCom Wireless for
US$2.4 billion. The acquisition expanded the network coverage to North Carolina,South
Carolina, Tennessee, Georgia, Puerto Rico and the U.S. Virgin Islands. At the end of the second
quarter of 2007, SunCom had more than 1.1 million customers. The deal closed on February 22,
2008.

On March 20, 2011, AT&T and Deutsche Telekom announced that AT&T will acquire T-Mobile
USA from Deutsche Telekom in a deal estimated to be worth $39 billion in cash and stock,
subject to regulatory approval. If this gets approved then AT&T would be the largest cell phone
provider in America; 25 - 30 Million customers ahead of Verizon Wireless.[2]

Global operations
[edit]Austria

Until 2000 T-Mobile was a shareholder of the former max.mobil. network. In April 2001 it acquired
100 percent and subsequently introduced the T-Mobile brand in Austria by rebranding max.mobil.
in April 2002 as T-Mobile Austria.

In 2005, it acquired former competitor tele.ring from Western Wireless International. It is now
used as a discount brand.
[edit]Croatia

T-Mobile entered the Croatian market in October 1999 when Deutsche Telekom (DT) initially
acquired a 35 percent interest in Hrvatski telekom, including its cell phone service
provider Cronet. Two years later, DT signed an agreement with the Croatian government to
acquire the additional 16 percent needed for a majority holding. In January 2003, Hrvatski
Telekom assembled all of its mobile activities under a single brand HTmobile. Finally, in October
2004, HTmobile became T-Mobile Hrvatska, or T-Mobile Croatia, thus joining the global T-Mobile
family also by name.[citation needed] Since January 1, 2010 Hrvatski Telekom and T-Mobile Croatia
merged into one company on the Croatian market under the name Hrvatski Telekom (engl.
Croatian Telecom) However T-Mobile brand remains active in the mobile business area and T-
Com in the fixed business area.
[edit]Czech Republic
T-Mobile was previously known as Paegas in the Czech Republic.

T-Mobile Czech Republic a.s. has been operating in the Czech market since 1996. As of May 30,
2008, 5.273 million customers were using T-Mobile services.

T-Mobile Czech Republic a.s. operates a public mobile communications network on

the GSM standard in the 900 and 1800 MHz bands and is also authorized to operate
a UMTSnetwork. T-Mobile was the first operator in the Czech Republic to launch this third-
generation technology on October 19, 2005 under the name Internet 4G.[citation needed]
[edit]Hungary

In May 2004, the same day as Hungary joined the European Union, the former company,
named Westel (which was owned entirely by the former Matáv) changed its name, and the entire
marketing. Westel was the most popular cellphone network in Hungary at the time. The company
was called T-Mobile Hungary, but after some financial decisions, as with the other T- companies,
it formed to Magyar Telekom Nyrt. Mobil Szolgáltatások Üzletág (Hungarian Telekom, Mobile
Services Business Unit), but they still say T-Mobile. T-Mobile also provides high-speed services,
like EDGE, 3G, and HSDPA in the major cities of Hungary.[citation needed]
[edit]Macedonia
Main article: T-Mobile Macedonia

In Macedonia, T-Mobile was previously known as Mobimak. The company has been operating in
the Macedonian market since 1996. On September 7, 2006, Mobimak accepted the international
T-Mobile branding. By June 2007, T-Mobile reached 1 million subscribers, out of which 85% were
active and using their services. T-Mobile MK covers 98.5% of the population. It has a GSM 900
license, offers GPRS, MMS and mobile internet services using T-Mobile HotSpots and has
implemented the EDGE fast mobile internet specification. T-Mobile Macedonia applied for a
UMTS license on August 1, 2007. The current codes are 070/071/072.[citation needed]
[edit]Montenegro

T-Mobile brand entered the Montenegrin market in 2006 through the acquisition of MoNet GSM
mobile provider. T-Mobile Montenegro (T-Mobile Crna Gora) is fully owned by T-Crnogorski
Telekom, which is itself owned by Magyar Telekom, a subsidiary of Deutsche Telekom. Although
the acquisition by Magyar Telekom was done in 2005, it was not until September 26, 2006 that
the MoNet GSM operator was re-branded as T-Mobile Montenegro.[citation needed]

MoNet GSM launched on July 1, 2000, as part of Telecom Montenegro. It became an

independent incorporated limited liability company a month later, on August 1, 2000. The
company currently holds around 34 percent of the Montenegrin market and uses GSM 900,
GPRS, and EDGE technologies. Since June 21, 2007 3G/UMTS services have been available in
larger cities as well as on the coast.[citation needed]
[edit]Netherlands

T-Mobile entered the Dutch market by the acquisition of Ben on September 20, 2002. T-Mobile
Netherlands, a wholly owned subsidiary of T-Mobile International, acquiredOrange
Netherlands from France Télécom for EUR 1.33 billion. This makes it the second largest mobile
telephone operator in the country behind KPN.[4]

[edit]Capacity problems in the Netherlands

T-Mobile announced in May 2010 that it was dealing with major capacity-problems on their 3G
network.[5][6] T-Mobile admitted the problems after a lot of pressure from customers and Dutch
media. T-Mobile could not keep up with the growing data demand of smartphones, caused by the
amount of new customers that wanted an iPhone, which was at the time sold exclusively by T-
Mobile. T-Mobile failed to keep up with the demand, and capacity problems on the network were
the result. T-Mobile denied the problems at first by saying to complaining customers that their
mobile phone or SIM-card was causing the problem.[7] The capacity problems occurred mostly in
cities and densely populated areas. When affected, people could experience problems with
calling or receiving calls, text messaging (SMS) or data-services. A substantial number of
customers was not able to use any of these services in cities or urban areas when the network
capacity was overloaded, affecting the cities Amsterdam and Utrecht the most. After being put
under pressure by several consumer interest groups and Dutch media, T-Mobile started a cash-
back settlement for all consumers which had complained about failing communication services. T-
Mobile invested tens of millions of euros to upgrade its network. The upgrade should be
completed at the end of Q1 of 2011. Till then, capacity problems can occur for customers.[8][9]
[edit]Poland

T-Mobile owns about 90% of shares[10] of Era, which serves over 13 million customers,[11] and
owns licenses for GSM 900, 1800, and UMTS. Its wireless Internet access through
GPRS/EDGE/HSDPA technologies is branded "Blueconnect" in Poland. Rebranding from the
local Era brand to international T-Mobile is planned,[12] for the first half of 2011. The décor of Era's
offices will be updated. The rebranding will be preceded by a number of concerts, featuring
underground dubstep scene artists, such as Caspa & Rusko, and one major world-known music
star whose name hasn't been revealed yet.[13]
[edit]Slovakia

The T-Mobile brand entered the Slovak market in May 2005, after rebranding the EuroTel
network from Eurotel Bratislava to T-Mobile Slovensko. The company Eurotel Bratislava was
partially owned by Slovak Telekom, an incumbent fixed line operator, which later acquired 100%
stake in Eurotel Bratislava. T-Mobile Int. and Deutsche Telekom never owned T-Mobile
Slovensko directly however DT is partially owner of Slovak Telekom and thus T-Mobile Int. has
procurement managing function within T-Mobile Slovensko. On 1 July 2010 Slovak Telekom and
T-Mobile Slovensko merged into one company on the Slovak market under the name Slovak
Telekom, however T-Mobile brand remains active in the mobile business area and T-Com in the
fixed business area.

T-Mobile network provides services on three networks GSM (900/1800 MHz), UMTS (2100 MHz),
Flash OFDM (450 MHz). Mobile data services are provided on GSM network with EDGE
extension and on UMTS with HSPA 7,2 bit/s/1,54 bit/s. Flash OFDM is one of two commercially
successfully launched solely data networks in the world. It supports download speed up to 5.3
MBit/s.
[edit]United Kingdom
Main article: T-Mobile (UK)
T-Mobile at Hatfield Business Park.

T-Mobile and Orange shops in Leeds.

T-Mobile UK started life as Mercury One2One, a GSM mobile network operated by the now-
defunct Mercury Communications.[14]Later known simply as One 2 One, it was the world's first
GSM 1800 network[15] when it was launched in September 1993. In its final days it was operated
as a joint venture between Cable and Wireless and American cable provider Mediaone Group,
which had a number of investments in Britain dating back to its days as the US West Media
Group. One 2 One was purchased by Deutsche Telekom in 1999[16] and rebranded as T-Mobile in
2002.[17]

T-Mobile offers both pay-as-you-go and pay-monthly contract phones. The pay-monthly contracts
consists of set amounts of minutes and 'flexible boosters' which allow the customer to change
them month to month depending on their needs. Prior to this T-Mobile had a contract option
known as 'Flext' which gave the user an amount of money to use for calls, texts, MMS and mobile
internet as necessary. This was withdrawn in early 2010.[18] T-Mobile launched their
3G UMTS services in the Autumn of 2003.

On December 12, 2007, it was confirmed that a merger of the high-

speed 3G and HSDPA networks operated by T-Mobile UK and 3 (UK) was to take place starting
January 2008. This will leave T-Mobile and 3 with the largest HSDPA mobile phone network in
the country, with a theoretical maximum speed of 6.5 Mb/s, rising to 7.2 Mb/s over the course of
the year, although HSDPA access is restricted to Web'n'Walk Plus customers and above.
On September 8, 2009 France Telecom's Orange and T-Mobile parent Deutsche
Telekom announced they were in advanced talks to merge their UK operations to create the
largest mobile operator with 37% of the market.[19] The long-term future of either brand is unclear
such deal is completed although both brands will be maintained for the first eighteen months at
least.[20]

Consumer Focus and the Communications Consumer Panel sent a joint letter to the then
Competition Commissioner Neelie Kroes in December 2009 asking for the merger to be
investigated by authorities in the United Kingdom, rather than Brussels.[21] The BritishOffice of
Fair Trading joined this call by asking the EU to allow it to investigate the proposed deal in
February 2010, saying that it believed the merger could have a 'significant' effect on competition.
[22]
On March 1, 2010 the European Commission approved the merger, on the condition that the
combined company sell 25% of the spectrum it owns on the 1800 MHz radio band and amend a
network sharing agreement with smaller rival3.[23] On 1 April 2010 Deutsche Telekom and France
Telekom finalised the deal and completed the merger of their UK based operations, causing
Orange UK and T-Mobile UK to cease to exist, although the brands will be maintained for at least
18 months.[24]

On 11 May 2010 the new parent company of the merged Orange UK and T-Mobile UK brands
was announced as "Everything Everywhere". Orange and T-Mobile will continue as leading
brands in the market, with each brand having its own shops, marketing campaigns, propositions
and service centres. However, behind the scenes, the two brands will be run by one company,
with one team and one vision "to give consumers instant access to the people, places and things
they want, wherever they are".[25]

T-Mobile's UK is also used as the backbone network behind Virgin Mobile (the world's first virtual
network), for both 2G and 3G signals. Although on a Virgin handset/simcard it will report as
saying Virgin and will not find T-Mobile UK on a manual network scan or have use of Orange's
network coverage.

[edit]Network outage

On November 17, 2009, as reported by Mobiholics.com,[26] there was a major network outage
in East of England, covering as far as Norfolk, Suffolk, Cambridgeshire & Essexcaused by a
damaged fibre optic cable. This resulted in about 12 hours of network outage.
AT&T Surges on $39 Billion Deal for T-
Mobile, U.S. Wireless Market Lead
By Greg Bensinger - Mar 21, 2011 12:33 PM PT

AT&T Inc. (T) rose after agreeing to buy T-Mobile USA fromDeutsche Telekom AG
(DTE) for $39 billion in cash and stock to create America’s largest mobile-phone
company.
The deal would allow AT&T, now the second-largest U.S. wireless operator, to add
about 34 million customers and surpass Verizon Wireless. The acquisition may face
government scrutiny because it combines the second- and fourth-largest wireless
providers, reducing consumer choice. Though regulatory approval may take a year,
cost savings and revenue gains could total $3 billion a year, Dallas-based AT&T said.
“Phenomenal deal if it happens,” Jonathan Chaplin, an analyst with Credit Suisse
Group AG, wrote in a research note yesterday. “Huge upside for AT&T; DT getting a
great price; however, we believe regulatory risk is enormous.”
AT&T rose 32 cents, or 1.1 percent, to $28.26 at 4 p.m. in New York Stock Exchange
composite trading. Deutsche Telekom rose 11 percent to 10.67 euros in Frankfurt
trading, the biggest gain since 2008.

Sprint Nextel Corp. (S), which had held talks with Deutsche Telekom about acquiring
T-Mobile according to people familiar with the matter, slumped 14 percent to $4.36.
‘Very Confident’

AT&T said that it would expand the rollout of its high- speed wireless technology,
called Long-Term Evolution, or LTE, under the T-Mobile agreement. AT&T will offer
the service to an additional 46.5 million people as part of the deal, helping achieve
the Federal Communications Commission goal of making broadband available more
widely, the company said.

“We studied this thing extensively over the last few months and we’re very confident
it will be approved,” Randall Stephenson, AT&T chairman and chief executive officer,
said in an interview. “Most local markets have a choice between five carriers, so the
space will remain fiercely competitive.”
The agreement has been approved by the boards of both companies, Deutsche
Telekom said in a statement.

The deal is the largest for AT&T since the acquisition of BellSouth Corp. in 2006 for
about $83 billion, according to data compiled by Bloomberg. It’s the largest takeover
to be announced in the wireless industry worldwide since 2004, when Sprint agreed
to merge with Nextel Communications Inc., and the sixth- largest mobile-phone deal
of all time.

IPhone Exclusivity

Since taking over as CEO in 2007, Stephenson had focused on growth through
wireless services, rather than the multi-billion- dollar acquisitions common under
his predecessor, Ed Whitacre. AT&T began selling Apple Inc. (AAPL)’s iPhone in
June 2007, and wireless data has since become one of its fastest-growing offerings,
with revenue up 27 percent in the fourth quarter.
AT&T lost its exclusive hold on the iPhone in the U.S. this year, as Verizon Wireless
began selling the device to its customers in February. Analysts estimate Verizon
Wireless may sell 11 million iPhones this year, the company said that month.

The T-Mobile deal may give AT&T a way to boost earnings because of the money the
companies would save by combining their operations. The companies’ estimate that
they could have $40 billion in synergies is a realistic assessment, said Credit Suisse’s
Chaplin.

Regulatory Issues

In the last five years, the median deal price for a telecommunications company has
been 4.5 times earnings before interest taxes depreciation and amortization,
according to Bloomberg data. Deutsche Telekom said the purchase price is multiple
of 7.1 times 2010 adjusted EBITDA.

The deal drew criticism for its potential to reduce the number of wireless
competitors.
“It’s difficult to come up with any justification or benefits from letting AT&T swallow
up one of its few major competitors,” Parul P. Desai, policy counsel for Consumers
Union, said in an e-mailed statement. “AT&T is already a giant in the wireless
marketplace, where customers routinely complain about hidden charges and other
anti-consumer practices.”
There were 296.3 million wireless subscribers in the U.S. at the end of 2010,
according to estimates from researcher eMarketer. Adding AT&T and T-Mobile
would give the combined companies 39 percent of the total, according to data from
eMarketer and ComScore Inc., while Verizon Wireless has 31 percent.

Spectrum Crunch

To get the deal through, regulators might require that T- Mobile and AT&T divest
some operations or agree to certain conditions, such as promising to build out their
network in certain, underserved markets, said Roger Entner, an analyst at Recon
Analytics in Boston.
Still, the combination would help alleviate some of the spectrum crunch that
regulators have been struggling with, he said. The two companies would be able to
share airwaves, which may help persuade the FCC and the Department of Justice to
approve the deal, Entner said.
Robert Kenny, a spokesman for the FCC, which is to review the deal alongside
antitrust authorities, declined to comment.

AT&T anticipates U.S. regulators will require it to divest wireless spectrum and
subscribers as a condition for approval, according to a person with knowledge of the
situation. The person declined to be identified because the matter is private.

T-Mobile, which accounts for about a quarter of Deutsche Telekom’s revenue, has
reported declining earnings as it missed out on the iPhone and it lagged behind
competitors in building out a higher-speed wireless network.

Cash and Stock

The purchase price will include $25 billion in cash and the balance in AT&T stock,
subject to adjustment, according to a statement yesterday. The deal may give
Deutsche Telekom an 8 percent stake in AT&T, which will add a Deutsche Telekom
executive to its board of directors.

AT&T said the cash part of the purchase price will be financed from the holdings on
AT&T’s balance sheet and new debt. AT&T has an 18-month commitment for a $20
billion unsecured bridge loan from JPMorgan Chase & Co. (JPM) The company is
not assuming any debt from T-Mobile or Deutsche Telekom.
AT&T has the right to increase the $25 billion cash portion of the purchase price by
up to $4.2 billion, offset by a reduction in stock, as long as Deutsche Telekom
receives at least 5 percent equity interest in AT&T, the company said. The number of
AT&T shares issued will be based on a 30-day average prior to closing, subject to a
7.5 percent collar.

AT&T agreed to a breakup fee of $3 billion and some spectrum if the deal fails to
close, said two people with knowledge of the matter.

AT&T was advised by JPMorgan, Greenhill & Co. and Evercore Partners on the deal.
Morgan Stanley, Deutsche Bank AG, and Credit Suisse Group AG advised Deutsche
Telekom.

To contact the reporter on this story: Greg Bensinger in New York

atgbensinger1@bloomberg.net
To contact the editor responsible for this story: Peter Elstrom
at pelstrom@bloomberg.net.
AT&T's T-Mobile deal: Regulatory
hurdles ahead
by Marguerite Reardon
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From a network and technology perspective, the $39 billion marriage
between AT&T and T-Mobile USA is a no-brainer, but the companies
may have to do some smooth talking to get the deal approved by
regulators.
AT&T and T-Mobile USA, which is owned by German phone company
Deutsche Telekom, each use the GSM technology and each company
plans to deploy the 4G technology known as LTE in the future. AT&T
plans to launch its LTE network this summer, and T-Mobile has said in
the past that LTE is on its roadmap.
Currently, each company has been upgrading its network to the latest
version of 3G wireless technology called HSPA+. (T-Mobile stirred up
controversy last summer when it began marketing the HSPA+ network
as 4G. AT&T, which initially criticized T-Mobile for this, began calling its
own HSPA+ network 4G earlier this year.)
The technology synergies between T-Mobile and AT&T are stark
contrast to how T-Mobile lined up with Sprint Nextel, which had been
rumored to be eying T-Mobile for more than two years. Sprint uses a
different network technology called CDMA, which is the same
technology that Verizon Wireless uses. What's more Sprint is using
WiMax for its next generation wireless network.
While regulators would have been much more eager to see No. 3
Sprint Nextel merge with No. 4 T-Mobile so that they could take on No.
1 Verizon Wireless and No. 2 AT&T, the reality is that such a scenario
would have been an integration nightmare for Sprint. Sprint is still
struggling to make sense of its 2005 acquisition of Nextel, which also
used a completely different technology.
T-Mobile subscribers, what's your response to the
AT&T acquisition?
• I'll stick with T-Mobile--er, AT&T.
• I'll switch to Verizon.
• I'll switch to Sprint.
• I'll switch to a virtual carrier--Virgin Mobile, or some such.
VOTEView results

"There's no question that AT&T and T-Mobile are a very good fit from a
technology standpoint," said Charles Golvin, an analyst with Forrester
Research. "A Sprint-T-Mobile deal would have given these companies
scale, but it made sense from an integration standpoint."
But even though the deal makes sense from a technology standpoint,
it won't necessarily be smooth sailing. For one, regulators are likely to
scrutinize this deal closely. And secondly, even though AT&T and T-
Mobile use the same technology, they use different wireless spectrum
bands to deliver their services. This means that AT&T will have to
move T-Mobile's customers to different spectrum bands in order to
integrate the networks.
Regulatory scrutiny
First let's look at the regulatory picture. The biggest issue for the FCC
and for the Department of Justice, which also needs to approve this
merger, is whether a merger between these companies would
concentrate too much power in the hands of a single company, which
could affect pricing and services for consumers. T-Mobile has always
been a price leader. It's safe to say that AT&T will likely not adopt T-
Mobile pricing, which means that consumers will be losing a more
affordable player in the wireless market.
And the reason is simple. It won't need to. AT&T and Verizon Wireless
already control more than 40 percent of the existing wireless market.
And T-Mobile, the smallest of the major wireless operators, would
concentrate AT&T's market power further. A combined AT&T and T-
Mobile would have nearly 130 million subscribers, which is a third more
than Verizon Wireless, the No. 1 nationwide player in the country. The
new AT&T-T-Mobile would also have twice as many customers as No. 3.
Sprint Nextel.
The FCC has already expressed concern over the competitive
landscape in wireless. In May the FCC warned that the industry is
getting too concentrated. In its report, the agency said that since
2003, market concentration in wireless has increased 32 percent. The
report indicates that 60 percent of the nation's subscribers and
revenue come from the country's two largest wireless providers: AT&T
and Verizon Wireless. The FCC noted that these companies are
continuing to gain customers as other national operators, Sprint Nextel
and T-Mobile USA, have been losing subscribers.
related coverage
AT&T-T-Mobile: By the numbers
On the cusp of a historic mobile operator merger between AT&T and T-Mobile, a look at
some key stats.
So far the FCC hasn't issued a statement regarding the proposed AT&T-
T-Mobile merger. But insiders at the agency have said previously that
they would be more concerned with an acquisition between AT&T and
Verizon Wireless and either Sprint Nextel or T-Mobile USA than a
merger involving Sprint Nextel and T-Mobile.
AT&T and Verizon Wireless have scoffed at the FCC's assertion that the
wireless industry is not competitive. And the companies have
repeatedly pointed to the fact that there are often four to five players
in almost every major market in the U.S. Smaller players such as
MetroPCS and Leap Wireless have aggressively moved into new
markets. And U.S. Cellular, a regional wireless carrier, has gotten high
marks in terms of customer satisfaction in many national surveys.
But the fact remains that AT&T and Verizon Wireless have far more
customers than any of these smaller players. Indeed, Golvin estimates
that a combined AT&T and T-Mobile would mean that three out of four
wireless subscribers in the U.S. would be a customer of either AT&T or
Verizon Wireless.
What's more, combining AT&T and T-Mobile, means that there would
be only one national wireless carrier using the GSM technology.
Verizon and Sprint Nextel use CDMA, as mentioned above. This would
give consumers, who want to use their phones overseas in places such
as Europe, only one choice in national U.S. carrier.
At least one congressional leader is already pushing the FCC and
Department of Justice to take a hard look at this deal.
"With every passing day, wireless services are becoming more and
more important to the way we communicate," John D. Rockefeller IV
(D-West Virginia), chairman of the Senate's Commerce Science and
Transportation committee, said in a statement. "So it is absolutely
essential that both the Department of Justice and the FCC leave no
stone unturned in determining what the impact of this combination is
on the American people."
While it is possible that the FCC and/or the Justice Department could
simply stop the merger from happening, it's unlikely they'd do that,
Golvin said. Instead, it's more likely that these agencies would put
conditions on the merger and require AT&T to divest some of its
wireless spectrum assets, he added.
"I don't believe this will have a 'yes' or 'no' outcome," Golvin said. "I
think what the regulators do will be more about the extent of AT&T's
divestiture."
In fact, the FCC took this approach when it approved Verizon's $28.1
billion merger of regional carrier Alltel Wireless, which closed in
January 2009. Instead of analyzing this merger on a national basis, the
FCC analyzed each individual market where Verizon and Alltel
operated. And in markets where there was too much concentration,
the FCC required that the Verizon sell those wireless assets. All told,
Verizon agreed to sell operations in 105 markets where Alltel also
operated.
AT&T CEO Randall Stephenson spoke to the Wall Street Journal on
Sunday and said that he is confident that the company will get
regulatory approval. He said that the merger will help "conserve
spectrum at a time when that resource is in tight supply."
He also said that the wireless market is already very competitive.
"This is probably the most fiercely competitive wireless market in the
world," he was quoted as saying. "The majority of Americans have the
option of five different wireless carriers."
Spectrum issues
Regulatory issues may be only one hurdle the companies face as they
look at integrating the two wireless networks. While it's true that T-
Mobile and AT&T each use GSM technology, the carriers also use
different bands of spectrum to deliver their services. Specifically, T-
Mobile uses the spectrum it bought in the AWS spectrum auction in
2006 to build its 3G wireless network.
AT&T also acquired spectrum in that auction. And it is using this AWS
spectrum to build its LTE network. AT&T uses its 850MHz and 1900MHz
spectrum to deliver its 3G service. Part of the reason that AT&T wanted
T-Mobile in the first place was to get more of the AWS spectrum for its
LTE network.
Meanwhile, T-Mobile has no additional spectrum to deploy LTE, since
it's been using the AWS spectrum for its 3G service. What this means is
that once AT&T and T-Mobile merge, AT&T will have to move all of T-
Mobile's existing 3G customers (which includes the supposed 4G
HSPA+ customers) to AT&T's 850MHz and 1900MHz spectrum. This
means T-Mobile customers will need new handsets, since the existing
T-Mobile 3G HSPA and 4G HSPA+ handsets will no longer work on the
AWS spectrum.
The migration of additional T-Mobile customers to AT&T's already
congested 3G network could also be painful for existing AT&T
customers. But Golvin believes that in the long run, AT&T will actually
benefit from the merger with T-Mobile because it will allow AT&T to use
the newly upgraded backhaul systems that T-Mobile has put in place to
link its radio network to the hard-wired Internet and telephone
backbone.
"For some period of time, customers from either network may find that
the quality is not what they would like," Golvin said. "But AT&T won't
be able to just turn off the T-Mobile network. It will take time and it will
be done in stages. I think what might be more painful for some T-
Mobile customers is that they were T-Mobile customers because they
didn't want to be AT&T customers."
The deal comes just days before the wireless industry meets in
Orlando, Fla., for the CTIA's spring trade show and conference. On
Tuesday morning, CEOs from three of the four major U.S. wireless
carriers--AT&T, Verizon Wireless, and Sprint Nextel--will take the stage
for a roundtable discussion. T-Mobile USA told All Things Digital that it
has dropped out of the panel discussion at CTIA. FCC Chairman Julius
Genachowski is also expected to give a speech Tuesday morning from
CTIA. It's unclear how much if anything the players involved in the
merger will say at CTIA. But CNET will be there, so stay tuned.
Update 7:38 p.m. PT:This story has been updated with information
regarding the panel of CEOs at CTIA.

Read more: http://news.cnet.com/8301-30686_3-20045236-

266.html#ixzz1Kwfud8BQ
In AT&T & T-Mobile Merger, Everybody Loses
By Om Malik Mar. 20, 2011, 1:53pm PT 357 Comments
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The lull of my lazy, rainy weekend was broken by the

news that AT&T plans to acquire T-Mobile USA for a whopping $39 billion in cash
and stock. Who wins and who loses in this deal? It’s hard to find winners, apart from
AT&T and T-Mobile shareholders. Here is a list of who loses, in my opinion, in this
deal:
Consumers. The biggest losers of this deal are going to be the consumers. While
AT&T and T-Mobile are going to try to spin it as a good deal to combine wireless
spectrum assets, the fact is, T-Mobile USA is now out of the market.
T-Mobile USA has been fairly aggressive in offering cheaper voice and data plans as
it has tried to compete with its larger brethren. The competition has kept the prices
in the market low enough. This has worked well for U.S. consumers. With the merger
of AT&T and T-Mobile, the market is now reduced to three national players: AT&T,
Verizon and Sprint. Net-net, U.S. consumers are going to lose.

Phone Handset Makers. Before the merger was announced, the handset makers
such as HTC and Motorola had two major carriers who could buy their GSM-based
phones. They just lost any ability to control price and profits on handsets because
now there is a single buyer that can dictate what GSM phones come to market. Even
with LTE becoming the standard for the 4G world, it would essentially be a market
dominated by three buyers (should Sprint go with LTE), which would place handset
makers at the mercy of the giants.
Sprint. The nation’s third-largest carrier was in talks to buy T-Mobile according to
Bloomberg, but AT&T’s offer has now pushed Sprint to the bottom of the pile in
terms of size and potentially spectrum assets if it goes through. If it doesn’t go
through, then Sprint now has a price it has to match in order to get its hands on T-
Mobile. Plus, 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.
Network Equipment Suppliers. The carrier consolidation has proved to be a
living hell for companies that make infrastructure network equipment. Alcatel-
Lucent, along with Ericsson and Nokia Siemens, are suppliers of gears to both AT&T
and T-Mobile USA. With a single customer, they will lost ability to control their own
fate and are going to see their profits suffer as a result.
Google. I think the biggest loser in this could be Google. In T-Mobile, it has a great
partner for its Android OS-based devices. Now the company will be beholden to two
massive phone companies — Verizon and AT&T — who are going to try to hijack
Android to serve their own ends.
Don’t be surprised if you see AT&T impose its own will on what apps and service are
put on its Android smartphones. I wouldn’t be surprised to see the worst phone
company in the U.S. (according to Consumer Reports) tries to create its own app
store and force everyone to buy apps through it.
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 experimented 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 the innovation of a lead pencil and has the mentality more suited to a
monopoly: a position it wants to regain.
AT&T and T-Mobile Merger to Create Industry Giant
Published: Sunday, 20 Mar 2011 | 9:37 PM ET
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By: CNBC.com with Reuters

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AT&T plans to pay $39 billion to buy Deutsche Telekom's T-Mobile USA in a deal
that is expected to attract intense regulatory scrutiny as it creates a new U.S. mobile
market leader.

AT&T [T 31.37 -0.05 (-0.16%) ], the No. 2 U.S.

mobile service, is looking to bolster its constrained
network against a near insatiable appetite for videos
and data from devices such
as Apple's [AAPL.O 346.75 -3.40 (-0.97%) ]iPhone
and iPad users.

But the world's largest deal announced so far this

year, which will bump Verizon Wireless from its No. 1 U.S. position, could raise the
ire of U.S. consumers and regulators as analysts expect it to result in wireless
service price increases. Consumers currently look to T-Mobile USA for some of the
best value wireless service rates. (See the CEOs discuss the regulatory outlook
in the video below).

The transaction will increase AT&T's U.S. market share to an estimated 43 percent
from 32 percent, putting it well ahead of Verizon Wireless's current 34.5 percent
share of U.S. mobile customers, according to Tolaga Research estimates. AT&T will
add 34 million customers to its current 96 million subscriber list.

As a sign of AT&T's confidence the deal will pass regulatory muster, it agreed to pay
an unusually high breakup fee of $3 billion and to give T-Mobile USA wireless
airwaves if regulators reject it. But they may be over-confident.
"I think it could reach some level of controversy," said an antitrust expert, who
worked for the Justice Department's antitrust division. "There's going to be spectrum
issues. This is going to be a complex deal and I don't think it's a foregone conclusion
that it will be approved."

Competitor Sprint Nextel [S 5.11 0.32 (+6.68%) ] said the merger would
dramatically alter the structure of the communications sector, creating a wireless
industry "dominated overwhelmingly" by the two vertically-integrated firms, which
already control around 80 percent of the U.S. wireless post-paid market.

"The DOJ and the FCC must decide if this transaction is in the best interest of
consumers and the U.S. economy overall, and determine if innovation and robust
competition would be impacted adversely and by this dramatic change in the
structure of the industry," the company told CNBC.

AT&T said it expected regulators to require it to sell some assets as a condition of

approving the deal, which it hopes to complete in 12 months.

But another regulatory expert said it could take as long as 18 months for U.S.
competition and communications regulators to review the transaction.

"I certainly wouldn't say that this is a clean deal," said an antitrust expert with
telecommunications experience.

AT&T Chief Executive Randall Stephenson told reporters on a conference call that
AT&T had done its "homework" on the regulatory front and boasted that the deal
could generate savings of more than than $40 billion.

"This is a unique opportunity." said Stephenson."It's

rare you have a transaction where the synergies are
greater than the price paid."

The companies have been talking for months according to sources familiar.
Stephenson reached out to Deutsche Telekom CEO Rene Obermann in December,
according to one source, who said he drove the process from the AT&T side.

The substance of the deal came together over the last month, and the companies
had a handshake agreement a week ago, the source said.

Talks Since December

The transaction, which is Stephenson's first big acquisition since he took over as
CEO, will give AT&T much needed spectrum, or wireless airwaves, to provide the
capability to support surges in the delivery of video, games and entertainment to
smartphone and mobile devices.

Stephenson said he had to "think differently" to address an expected eight-to-tenfold

increase in demand for wireless network capacity in the next five years.

It comes as U.S. wireless operators fight for wireless airwaves that are in short
supply as consumers spend more time conducting video chats, playing games and
downloading applications over mobile devices that rival the powers of desktop
computers of just a few years ago.

The two top operators — a much larger AT&T and Verizon Wireless — will account for
nearly three out of four mobile subscriber in the United States, according to Forrester
Research analyst Charles Golvin.

For Deutsche Telekom, the attractively valued deal terms of an estimated 7.1 times
multiple of 2010 adjusted earnings before interest, tax, depreciation and
amortization, gives it a tidy partial exit from the U.S. market that once held great
promise at the turn of the millennium, but led to steep stock declines. Under the
current terms of the deal, Deutsche Telekom could become AT&T's largest
shareholder with an 8 percent stake.

Left unanswered is the fate of smaller rivals, namely Sprint Nextel [S.N 5.11
0.32 (+6.68%) ], which had held talks to combine with T-Mobile USA, the No. 4 U.S.
mobile service.

"Other reported deals involving T-Mobile would have joined together incompatible
networks," said Larry Cohen, head of CWA the main U.S. telecommunications
workers union. "Not only would that have forced a rebuild, but would have required
new phones for T-Mobile customers."

The purchase price includes a cash payment of $25 billion with the balance to be
paid using AT&T common stock. AT&T has the right to increase the cash portion of
the purchase price by up to $4.2 billion.
As part of the deal, which was approved by both companies boards, a Deutsche
Telekom representative will join the AT&T board. AT&T can increase the cash
component so long as Deutsche Telekom retails at least a 5 percent equity stake in
it.

Deutsche Telekom is expected to use 5 billion euros to buy back shares and 13
billion euros to lower its debt, one source with direct knowledge of the deal
discussions told Reuters. The
source said no other deals are planned in the medium term.

AT&T said it would finance the cash portion with new debt and cash on AT&T's
balance sheet. AT&T has an 18-month commitment for a one-year unsecured bridge
term facility underwritten by JPMorgan Chase & Co [JPM.N 45.85 0.35 (+0.77%)
] for $20 billion.

AT&T will not assume any T-Mobile USA debt and that the deal would add to
earnings, excluding non-cash amortization and integration costs, in the third year
after closing.

Representatives from the U.S. Federal Communications Commission and Sprint

declined comment as did officials from Verizon Wireless, which is owned byVerizon
Communications [VZ.N 38.27 0.02 (+0.05%) ] and Vodafone Group.

Greenhill & Co, JPMorgan Chase and Evercore Partners acted as financial advisors to
AT&T. Morgan Stanley, Deutsche Bank and Credit Suisse acted as financial advisors
to Deutsche Telekom.

AT&T, T-Mobile Deal 'Shocked' Sprint CEO

Published: Tuesday, 22 Mar 2011 | 8:28 PM ET
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By: Drew Sandholm
Web Producer

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Sprint Nextel CEO Dan Hesse on Tuesday said he was "shocked" to learnAT&T
plans to purchase Deutsche Telekom's T-Mobile USA for $39 billion, a deal that
would create the largest U.S. wireless carrier if approved by regulators.

T-Mobile USA
From Wikipedia, the free encyclopedia

T-Mobile USA, Inc.

T-Mobile USA logo, 2006-present

Type Private (subsidiary of T-Mobile International AG)

Industry Wireless telecommunications

Fate Pending acquisition by AT&T Inc.

Predecessor VoiceStream Wireless PCS

Founded 1994 as VoiceStream Wireless PCS

Founder(s) John W. Stanton

Headquarters Bellevue, WA, U.S.

Area served United States

Puerto Rico

U.S. Virgin Islands

Key people Philipp Humm, President andCEO

Products myTouch 4G

T-Mobile Jet™ 2.0

T-Mobile 4G Mobile Hotspot

Services Even More Individual

Even More Family

Even More webConnect Overage Free

Pay As You Go

Premium Handset Protection

Revenue US$21.347 billion (2010)

Operating income US$2.705 billion (2010)

Net income US$1.354 billion (2010)

Total assets US$46.291 billion (2010)

Total equity US$20.492 billion (2010)

Employees 42,000 (2010)

Parent Deutsche Telekom

Website t-mobile.com
 References: [1][2]

T-Mobile USA, Inc. is a mobile network operator headquartered in Bellevue, Washington, United States that

provides wireless voice, messaging and data services in the United States, Puerto Rico and the U.S. Virgin

Islands. T-Mobile USA is the fourth-largest wireless carrier in the U.S. market with 33.73 million customers

and annual revenues of US$21.35 billion in 2010. As of 2011, J.D. Power has ranked T-Mobile highest

among major wireless carriers for retail store satisfaction four years consecutively and highest for wireless

customer care two years consecutively.

T-Mobile USA traces its roots to the 1994 establishment of VoiceStream Wireless PCS as a subsidiary

of Western Wireless Corporation. Spun off from Western Wireless Corporation on May 3, 1999,

VoiceStream Wireless was purchased by Deutsche Telekom in May, 2001 for US$35 billion and re-named
T-Mobile USA, Inc. in July, 2002. T-Mobile USA, Inc. is the United States operating entity of T-Mobile

International AG, the mobile communications subsidiary of Deutsche Telekom AG.

On March 20, 2011 Deutsche Telekom accepted a US$39 billion stock and cash purchase offer from AT&T

Inc. for T-Mobile USA, Inc. When completed, the acquisition will create the largest wireless carrier in the

United States with nearly 130 million customers. The acquisition is subject to regulatory and shareholder

approval and is expected to close in March 2012.

Contents
[hide]

• 1 History

o 1.1 VoiceStream Wireless

o 1.2 Acquisition of VoiceStream by Deutsche Telekom

o 1.3 Proposed purchase by AT&T

• 2 Networks

o 2.1 Roaming

o 2.2 T-Mobile HotSpots

o 2.3 Wi-Fi calling

o 2.4 3G AWS upgrade

o 2.5 Radio frequency summary

• 3 Current products and services

o 3.1 Even More

o 3.2 Even More Plus

o 3.3 webConnect Internet

 o 3.4 Flexpay

• 4 Customer Service

o 4.1 Awards

o 4.2 Criticism

o 4.3 Sidekick data outage

• 5 Marketing

• 6 Labor relations

o 6.1 Formation of TU

o 6.2 2009 coordinated organizing effort

 6.2.1 Political pressure

o 6.3 Reports

o 6.4 Workplace activities

• 7 Information Security

• 8 See also

• 9 References

• 10 External links

o 10.1 Official websites

o 10.2 Unofficial sites

[edit]History

T-Mobile USA traces its roots to the 1994 establishment of VoiceStream Wireless PCS as a subsidiary

of Western Wireless Corporation. Spun off from parent Western Wireless Corporation on May 3, 1999,

VoiceStream Wireless was purchased by Deutsche Telekom in 2001 for US$35 billion and re-named T-

Mobile USA, Inc. in July, 2002.[3][4][5]

[edit]VoiceStream Wireless
VoiceStream Wireless PCS was established in 1994 as a subsidiary of Western Wireless Corporation to

provide digital wireless personal communications services (PCS) in 19 FCC-defined metropolitan service

areas.[6] VoiceStream's digital, urban service areas complemented the analog, rural service areas marketed

by Western Wireless under the CELLULAR ONE brand.[7]

VoiceStream Wireless logo

VoiceStream was a wholly owned subsidiary of Western Wireless Corporation until December 1997, when

United States federal regulators granted Western Wireless' request to exceed a foreign ownership cap. The

waiver allowed Hong Kong-based Hutchison Whampoa to buy a 19.9% stake in the VoiceStream subsidiary.
[8]

On May 3, 1999, the VoiceStream division was spun off from Western Wireless Corporation as an

independent company. The spin off was intended to remove any conglomerate discount, get better value

recognition for each of Western Wireless's core analog cellular and digital PCS networks and help each

business pursue independent strategies.[9]

Immediately after the spin-off, VoiceStream acquired regional carriers Aerial Communications, Inc., in

the midwest, and Omnipoint Corporation, in the northeast.

[edit]Acquisition of VoiceStream by Deutsche Telekom

On May 31, 2001, Deutsche Telekom acquired VoiceStream Wireless Inc. On the same day, Deutsche

Telekom also acquired southern regional carrier Powertel for US$24 billion.

In September 2002, the company took its current name, T-Mobile USA, Inc. and began using the T-Mobile

brand. T-Mobile USA, Inc. is the United States operating entity of T-Mobile International AG, the mobile

communications subsidiary of Deutsche Telekom AG.[2]

On September 17, 2007 T-Mobile announced the acquisition of SunCom Wireless for US$2.4 billion. T-

Mobile closed the acquisition on February 22, 2008 and by September 8, 2008 SunCom's operations were

integrated with those of T-Mobile. The acquisition added SunCom's 1.1 million customers to T-Mobile's

customer base and expanded T-Mobile's network coverage to include North Carolina, South
Carolina, Tennessee, Georgia, Puerto Rico and the U.S. Virgin Islands.

[edit]Proposed purchase by AT&T

On March 20, 2011 Deutsche Telekom accepted a US$39 billion stock and cash purchase offer from AT&T

Inc. for T-Mobile USA, Inc. The acquisition is subject to regulatory approvals, a reverse breakup fee in

certain circumstances, and customary regulatory and closing conditions and is expected to close in March

2012.[10][4][11][12]

According to an industry analyst, after the introduction of the iPhone in 2007, T-Mobile USA began to lose

lucrative contract customers, dropping to 78.3 percent of subscribers in 2010, compared to 85% in 2006. T-

Mobile USA's high churn rate of 3.2% compared to 1.2% at Verizon and AT&T, the needed investments in

network upgrades and spectrum purchases were too risky given the drop in contract customers, reenforcing

Deutsche Telekom's decision to sell.[13]

When the merger completes, AT&T Mobility will have a customer base of approximately 130 million

customers, making AT&T Mobility the largest wireless carrier in the United States.[4]

[edit]Networks

T-Mobile branch office, San Juan, Puerto Rico

Through acquisitions of Aerial, APT, Digiph PCS, Eliska, General Cellular Corp, GSM Alliance, Intercel,

Omnipoint, Pacific Northwest Cellular, Powertel, SOL Wireless, SunCom Wireless, Voicestream, Western

PCS, GSM Facilities,[14] and Western Wireless, T-Mobile has added sites to its network.[15] The native T-

Mobile network currently consists of 36,400 cell sites and predominantly uses

theGSM/GPRS/EDGE 1900 MHz frequency-band, making it the largest 1900 MHz network in the United

States.[citation needed] As of 2010, T-Mobile covers over 293 million customers.[16]

Data service is available to most users in the form of the older General Packet Radio Service (GPRS) or

newer Enhanced Data Rates for GSM Evolution (EDGE). EDGE coverage is stated as being available within

at least 40% of the GSM footprint.[17] 3G service in the form of Universal Mobile Telecommunications

System (UMTS) is available in most major markets. 3G (UMTS/HSPA/HSPA+) service by T-Mobile

exclusively uses the AWS 1700/2100 MHz frequency-band, making most handsets sold by other US-based

3G UMTS/HSPA operators incompatible. On the 5th of January 2010, T-Mobile announced that it has

upgraded its entire 3G network to HSPA 7.2 Mbit/s which is an improvement from its previous peak of 3.6

Mbit/s. T-Mobile also said that it plans to be the first U.S. carrier to deploy HSPA+ across its network by mid

2010. T-Mobile has finished HSPA+ trials in Philadelphia and has begun deploying HSPA+ across its

network, HSPA+ is still available in Philadelphia. HSPA+ 21 service is now available to

Wireless Market Share By Device And ISP

Verizon has 31.1% market share to AT&T's 25.2%

by Karl Bode Friday 07-May-2010 tags: business · stats ·wireless
Tipped by Deficit_Hawk
CNET directs our attention to a new study by Comscore that breaks down wireless market share
by both carrier and device. According to the study Verizon claimed a 31.1% share of all cellular
customers during the first quarter, compared to 25.2% for AT&T, roughly 12% for each for both T-
Mobile and Sprint, and 5.1% for Tracfone. The study found that 63.7% of users used SMS/MMS,
30.1% surfed the web with a mobile browser, 28.6% downloaded apps, 21.8% played games,
18.7% accessed social networking sites or blogs, and 13.2% used their phones to listen to music.
As for device manufacturers, both Motorola and Samsung took top honors with 21.9% each,
followed closely by LG with 21.8% and Research In Motion and Nokia -- both with 8.3%.
Table 1: Market Concentration in the Wireless Industry, March 2010

Carrier Share, % Share Percentage,

Squared
Verizon 31.1% 967
AT&T 25.2% 635
Sprint 12.0% 144
T-Mobile 12.0% 144
Tracfone 5.1% 26
Totals 85.4% 1916
 200000.00%
180000.00%
160000.00%
140000.00% Verizon
120000.00%
100000.00% AT&T
80000.00% Sprint
60000.00%
40000.00% T-M obile
20000.00% Tracfone
0.00%
Share, % Totals

Share, %

18%

50% 15%

7%
3% 7%

Verizon AT&T Sprint T-Mobile Tracfone Totals

This is what a noncompetitive oligopoly market looks like. We already see this in a lot of important
ways—suboptimal cell service, attrocious customer service, stubbornly high prices, and charges
that are often exponentially larger than the marginal cost.

The prices for text messaging in particular are a great example of “price gouging” and illustrate
the industry’s tacit collusion (pdf). The cost for the network provider of handling a text message is
virtually zero, since the messages are small enough to fit into the “control channel,” or the tiny bit
of data that your phone and cell network are exchanging even when you’re not talking or using
mobile data.
In a truly competitive wireless market, a customer would drop a provider who charges up to
$20/month for something that’s actually nearly free to provide. Imagine if McDonalds sold
hamburgers at their current prices but charged $0.20 for each french fry—or $20 for all the fries
you can eat. Potatoes are cheap, so we’d be offended and take our money elsewhere, because
the fast food market is highly competitive.

In mobile telephony, however, there almost is no “elsewhere” to take our money, especially if you
need reliable nationwide coverage. The number of players is small enough, and customers are
locked in enough, that there is little opportunity to punish this price gouging. (Thankfully, free
messaging-over-data via services such as Google Voice allow customers some opportunity for
arbitrage, but expensive data plans and technological know-how limit this opportunity to to the
most economically and technologically well-positioned customers.)

So the bad news of an uncompetitive market is already here. Now, let’s see what the market
might look like after an AT&T/T-Mobile merger. Here’s that table, assuming that all T-Mobile
customers stay with AT&T (and most will have to for some time, thanks to their two year
contracts):

Table 2: Approximate Market Concentration Following AT&T/T-Mobile Merger

Carrier Share, % Share Percentage,

Squared
AT&T plus T- 37.2% 1384
Mobile
Verizon 31.1% 967
Sprint 12.0% 144
Tracfone 5.1% 26
Totals 85.4% 2521
 Share, %

22%

50%

18%

3% 7%

AT&T plus T-Mobile Verizon Sprint Tracfone Totals

A substantial number of T-Mobile customers will switch to Verizon or Sprint, but the HHI would
still be in the mid-2000’s, and no scenario makes this market more competitive than today’s
market. In short, customers and regulators should be worried.

Now imagine what happens when it’s specifically T-Mobile that goes away. They have long been
the cheapest option, offering the worst service among the big four in exchange for much cheaper
prices. They’re the only company that has experimented with discounted pricing for month-to-
month customers. Inexplicably, they’re still the only major US carrier to deploy UMA, which allows
voice calling over wifi. (I’d love to use my Verizon minutes to make and receive calls over my
home wifi router; instead, I’m forced to take the chance that I’ll drop yet another call in my first-
floor apartment. Can you hear me now?)

T-Mobile offers several unique features in the otherwise troublesome wireless market, and AT&T
is unlikely to keep many if any of them. Ma Bell just wants the customers, towers, and spectrum.
If they wanted to sport UMA or cheaper pricing, they could have offered them years ago.

The current cell market is already highly concentrated, so we get service that is overpriced, with
limited features and a quality of service that does not justify what we pay. If federal regulators
allow AT&T to buy T-Mobile—which, unfortunately, is practically a given—the market will be even
less competitive.

This merger means less choice and still-higher prices for something like the service we’ve long
since been promised. If you have a lot of stock in the telecom industry, however, it’s a big win.
AT&T to buy T-Mobile USA
T-Mobile subscribers, what's your response to the
AT&T acquisition?
• I'll stick with T-Mobile--er, AT&T.
• I'll switch to Verizon.
• I'll switch to Sprint.
• I'll switch to a virtual carrier--Virgin Mobile, or some such.
VOTEView results

Read more: http://news.cnet.com/8301-30686_3-20045236-

266.html#ixzz1KwknJkD9

T-Mobile subscribers, what's your response to the

AT&T acquisition?
• I'll stick with T-Mobile--er, AT&T.
45%
• I'll switch to Verizon.
27%
• I'll switch to Sprint.
16%
• I'll switch to a virtual carrier--Virgin Mobile, or some such.
12%
• Total votes: 9283
Cast your vote

Read more: http://news.cnet.com/8301-30686_3-20045236-

266.html#ixzz1KwkuXFGd