AT&T to acquire T-Mobile USA for $39 billion [Update]

AT&T has entered in a definitive cash-and-stock agreement with Deutsche Telekom to acquire T-Mobile USA that will make AT&T the largest wireless provider in the United States. The company announced today that the board of directors from both companies have approved the acquisition which is worth a whopping $39 billion and will grant Deutsche Telekom an 8% equity stake and ownership interest in AT&T. It will also allow for a Deutsche Telekom representative to join AT&T's board of directors.

In a statement, AT&T was strong on emphasizing the importance the acquisition has on the expansion of 4G LTE. Randall Stephenson, CEO of AT&T, said that the partnership would help "improve network quality" and will assist in bringing "advanced LTE capabilities to more than 294 mllion people." René Obermann, CEO of Deutsche Telekom, underscored the importance of 4G as well and stated that after looking over several creative strategies for T-Mobile USA, AT&T is "the best partner for [their] customers." The partnership would also allow AT&T to invest over $8 billion in the United States over the next seven years in infrastructure that will benefit rural communities and small towns.

Both companies also stressed that all customers will see an improvement in service as the partnership is a definitive solution for the "impending spectrum exhaust" that mobile providers are facing.

The deal would have AT&T pay Deutsche Telekom a cash payment of at least $25 billion, which could easily fluctuate to more than $29 billion as long as Deutsche Telekom receives at least 5% equity, and is expected to close in the next 12 months with approval from regulators.

No comments were made about how the acquisition will affect customers financially if at all, but the companies did hint that the market will remain competitive.

Update: T-Mobile has posted an update on their website about what the merger means for its customers. The company says T-Mobile USA will continue to operate as an independent company until the acquisition is complete (expected in approximately 12 months). It reiterates that both companies working together can provide 95% of the United States with 4G LTE, which would be near impossible for each company respectively. T-Mobile says they will "honor all contracted plans that are entered into before the change of ownership."

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Didn't they spend millions years ago breaking up the bell monopoly?That needs to be done to the cable company's,people always lose jobs in mergers,but they are already spending millions in lobbying for this to happen.People will lose in this w/higher fees and less competition,but they will make billions more in the end;and isn't that's whats it all about.

Just a quick question, what is the difference when Verizon bought Alltel a couple of years back creating the largest US cellphone company? What's the difference between this and AT&T taking over T-Mobile?

Booo!
I'd rather have T-Mobile USA stay a German company.

I also fear loss of benefits when roaming in the US with my Deutsche Telekom contract on my iPhone.

GS:win

I originally had AT&T wireless and switched to Cingular after HORRIBLE customer service. I was mortified when AT&T 'merged' with Cingular. No surprise here, AT&T gave their Cingular customers HORRIBLE customer service. After trying to upgrade to a new phone AT&T refused to remove a $5 charge which was obviously their doing, instead of: 1) keeping an existing customer, and 2) signing them to a new 2 year contract. Instead I canceled and signed up with T-Mobile for 2 years.

Best thing I've ever done. Since that time they've set honorable prices, hired friendly staff, and gave me a great no limit voice, data and sms for $80/month.

Still, T-Mobile was slow rolling out 3G so I signed up for AT&T (thinking it was water under the bridge). They ended up charging me DOUBLE what I opted in for, but offered no apologies and allowed me to quit.

I filed a Better Business Bureau report on them claiming bait & switch, and a nice AT&T rep was determined to work with me (read: remove that negative BBB score). Ultimately, it was just too much for me and I opted to stay with T-Mobile.

I will burn in hell before I give AT&T any more of my time. Verizon here I come.

Cingular bought AT&T Wireless, then a few years later merged with AT&T's landwire outfits and other various baby Bells and changed it's name to AT&T because it had better brand recognition than the Cingular name. AT&T is just Cingular under a new name. The old AT&T is dead.

DAMN ... That stinks ... I'm a T-Mobile customer and AT&T blows ...
As soon as the deal gets approved I'm going to drop them and select
some else.

Maybe I might just do something strange and new ... like NO PHONE ...
If I want to talk to my friends, I'll go see them. I'll be more hands on
and in person, instead of texting or calling them. I still have a landline
So, maybe having no phone is the best thing for now.

GenBlood said,
DAMN ... That stinks ... I'm a T-Mobile customer and AT&T blows ...
As soon as the deal gets approved I'm going to drop them and select
some else.

Maybe I might just do something strange and new ... like NO PHONE ...
If I want to talk to my friends, I'll go see them. I'll be more hands on
and in person, instead of texting or calling them. I still have a landline
So, maybe having no phone is the best thing for now.

According to the T-Mobile site the two companies are still remaining "separate" and T-Mobile will still honor prices from the previous contracts. You'll probably end up benefiting in the end with the range of what used to be two separate networks now available as one.

"advanced LTE capabilities to more than 294 mllion people."

The merger might not happen and I hope the price doesn't go up and merger would not have issue with service i think it would improve instead.

oh please no, I have been with T-Mobile for 10 years now and never had any issues with service or customer support. AT&T on the other hand I hear constant complaints. The larger the company the worse the customer service in my opinion.

I actually like T-mob for I could have cheap internet whenever I was in the US, unilimited access for $1/day on pay as you go has been perfect for me for mail and occasional browsing. Somehow I expect ATT to axe this one..

When I left T-Mobile for US Cellular back in December 2010, I was very reluctant and unsure if I had made the correct decision by doing so or not. I guess I did...

Horrible news! wow, this is really messed up for us T-mobile users, because AT&T will surely kill all the unlimited cheap data plans, I really hope the government does not allow this! This is like the worst tech news in the last few years, less competition, less choices for the consumer

probably the death of T Mobile. figured they'd go with the folks that helped them. Sprint. Which is no angel. But batter than AT&T

They would have never been able to go to #1 on their own, they have to buy someone out to do that.
T-Mobile rates will no go thru the ceiling. Probably in about 1 year they will start raising their prices.

You know, I was thinking. Do you think this merge could have anything to do with T-Mobile's bashing of AT&T and the iPhone? Perhaps AT&T is tired of it and wants to be sure they can end it by absorbing one of their direct competitors.

Tanshin said,
Do you think this merge could have anything to do with T-Mobile's bashing of AT&T and the iPhone?

I don't think I've ever seen a T-Mobile ad that bashed AT&T or the iPhone. Are you sure you aren't thinking of Verizon?

roadwarrior said,

I don't think I've ever seen a T-Mobile ad that bashed AT&T or the iPhone. Are you sure you aren't thinking of Verizon?
Turned on the tv in the past 3 months or so?

/- Razorfold said,
Turned on the tv in the past 3 months or so?

I don't watch a lot of network TV, but listen to the radio a good bit. I hear plenty of ads for Verizon and other wireless carriers, but maybe they just aren't playing those ads in my area, or are only playing them on certain TV stations.

roadwarrior said,

I don't think I've ever seen a T-Mobile ad that bashed AT&T or the iPhone. Are you sure you aren't thinking of Verizon?

Oh yeah, they're there. They mainly feature a guy with a person wearing a suit and blue tie that does something that in some way restricts the iPhone user (climbing on his back to slow him down, etc). I believe they also have one that goes after both AT&T and Verizon and the iPhone now.

Tanshin said,

Oh yeah, they're there. They mainly feature a guy with a person wearing a suit and blue tie that does something that in some way restricts the iPhone user (climbing on his back to slow him down, etc). I believe they also have one that goes after both AT&T and Verizon and the iPhone now.

You forgot the most important part, the hot spokeswoman.

RangerLG said,

You forgot the most important part, the hot spokeswoman.

Very true. I guess I got too distracted by their fancy distortion effect they use on the iPhone user when he steps out of his circle.

This will go through. Verizon has been snapping up smaller providers for a while now. Also, look at the Comcast / NBC deal (or whatever company they just bought). The government put some small restrictions in place. But there is no reason this wouldn't be approved.

I've never had a problem with AT&T or any of my iPhones. Am I the only one?

Sigh... and this only further proves that AT&T is really shifting their focus from wireline to wireless. Why they won't use some of their billions in profit to revamp the lines (eg rotten copper in older districts or perhaps laying fiber) is beyond me.

Tanshin said,
Sigh... and this only further proves that AT&T is really shifting their focus from wireline to wireless. Why they won't use some of their billions in profit to revamp the lines (eg rotten copper in older districts or perhaps laying fiber) is beyond me.

You know what really sucks? They will only add services if tax payers subsidize it (Without paying back any subsidies mind you). My house was built in 2001 with fiber to the premise and the company that served it pulled out a few years ago. When they pulled out their tech people actually started yanking the fiber out of the ground and pulling off the covers of the boxes attached to each house. The Fiber to the house was paid for through municipal funding and broadband tax subsidies and the units on the houses were included in the construction costs on the house. The ONLY thing the company should have legally been able to do is disable the IP services on there end. So now i have fiber in the house and a shredded cable to the street and no one wants to light up the neighborhood but Comcast is running their old coax still and ATT still pushing uverse/dsl and prices only go up and now we got ATT caps to boot.

blahism said,

You know what really sucks? They will only add services if tax payers subsidize it (Without paying back any subsidies mind you). My house was built in 2001 with fiber to the premise and the company that served it pulled out a few years ago. When they pulled out their tech people actually started yanking the fiber out of the ground and pulling off the covers of the boxes attached to each house. The Fiber to the house was paid for through municipal funding and broadband tax subsidies and the units on the houses were included in the construction costs on the house. The ONLY thing the company should have legally been able to do is disable the IP services on there end. So now i have fiber in the house and a shredded cable to the street and no one wants to light up the neighborhood but Comcast is running their old coax still and ATT still pushing uverse/dsl and prices only go up and now we got ATT caps to boot.

It is a really messed up situation. One of my friends was telling me that their local company (not sure if it's AT&T, probably is) stopped laying lines at the start of their neighborhood because it was too new and not economical. So now they're all stuck with wireless services (no cable, no landlines) because of it.

I really hope this deal doesn't get approved. It's way too big of a merger and reduces competition since it means less mobile providers in the US. But knowing that AT&T and the government are in bed together, I won't be surprised if the deal does go through.

Kevin. said,
I really hope this deal doesn't get approved. It's way too big of a merger and reduces competition since it means less mobile providers in the US. But knowing that AT&T and the government are in bed together, I won't be surprised if the deal does go through.

Do you have something to back up the claim that AT&T and the government are "in bed together"? Given AT&T's past history with the government, I think they've made the wrong friends in the government... lol

Maybe this will push for better comp between them and Verizon now. I'd like to see prices come down not go up for a change!! The only thing around here that has good coverage is Verizon so unless this turns out better for consumers it won't much difference either way.

sava700 said,
Maybe this will push for better comp between them and Verizon now. I'd like to see prices come down not go up for a change!! The only thing around here that has good coverage is Verizon so unless this turns out better for consumers it won't much difference either way.

Unfortunately, I don't see how less competition is going to work to drive the price down for anyone here...

sexypeperodri said,
This is great news.

For CEO's sure, for consumers, it sucks ass. TMO was the only price pressure against VZ and ATT and now its just gonna be VZ & ATT with Sprint out there fiddling around..

blahism said,

For CEO's sure, for consumers, it sucks ass. TMO was the only price pressure against VZ and ATT and now its just gonna be VZ & ATT with Sprint out there fiddling around..

Yeah, except that there are also a BUNCH of other players in the wireless market. But sort of like political parties, people only ever seem to want to talk about the 2 or 3 biggest players, forgetting that there are plenty of other (often better) options.

http://en.wikipedia.org/wiki/L...nications_service_providers

roadwarrior said,

Yeah, except that there are also a BUNCH of other players in the wireless market. But sort of like political parties, people only ever seem to want to talk about the 2 or 3 biggest players, forgetting that there are plenty of other (often better) options.

http://en.wikipedia.org/wiki/L...nications_service_providers

I'm willing to bet at LEAST 90% of these are resellers of Sprint and whatnot. You're not getting away from the "Core 3" even if you try

blahism said,

I'm willing to bet at LEAST 90% of these are resellers of Sprint and whatnot. You're not getting away from the "Core 3" even if you try


The list specifically states which ones are resellers, they are identified as MVNOs. My wife's Android phone is with Cellular South, which is one of the largest regional carriers in the US (and that I've previously done tech work for).

My Net 10 phone operates on the T-Mobile network though, and I've got a netbook through AT&T. Maybe once this deal goes through my Net 10 phone will get better service, since T-Mobile's coverage in my part of the country simply sucks compared to AT&T.

roadwarrior said,

The list specifically states which ones are resellers, they are identified as MVNOs. My wife's Android phone is with Cellular South, which is one of the largest regional carriers in the US (and that I've previously done tech work for).

My Net 10 phone operates on the T-Mobile network though, and I've got a netbook through AT&T. Maybe once this deal goes through my Net 10 phone will get better service, since T-Mobile's coverage in my part of the country simply sucks compared to AT&T.

Never heard of most of that list and some that aren't marked resellers i know are resellers.. Not looking to be stuck with a regional carrier as well since i do travel a lot. Tmobile was going to be my next option since they have competitive pricing, but obviously that isn't happening anymore. Maybe sprint is all that is left but their network is meh in a lot of areas

People need to grow up a little. While I am never the first to stick up for ATT...I have been with them for over 12 years now and have been treated quite well. Personally I am going to sit back and see how this plays out. This could be a good thing.

BlendedFrog said,
People need to grow up a little. While I am never the first to stick up for ATT...I have been with them for over 12 years now and have been treated quite well. Personally I am going to sit back and see how this plays out. This could be a good thing.

You are one of the lucky ones. I have been treated like utter s*** by AT&T, and so has everyone else I know. I am not looking forward to this at all.

crispkreme said,

You are one of the lucky ones. I have been treated like utter s*** by AT&T, and so has everyone else I know. I am not looking forward to this at all.

As has anyone I've known that has had AT&T. Luckily I didn't have them long.

LOL I just switched from Verizon to TMobile this December. Never had a problem with ATT back in the day when I had them so I don't care all that much, however, I don't think this is good for competition at all.

My only gripe on t-mo has been the 2nd rate EDGE data service for t-mobile 3g consumers roaming on at&t/cingular data networks. Still, if approved, this is very sad news for gsm users across America and part-time gsm visitors like myself.

Cheers

This is a load of crap, I really do love having a SIM card, but not enough to stay with AT&T... If this goes through, Verizon here I come.

negroplasty said,
This is a load of crap, I really do love having a SIM card, but not enough to stay with AT&T... If this goes through, Verizon here I come.

That's like jumping from the pot into the fire? Ouch!

negroplasty said,
This is a load of crap, I really do love having a SIM card, but not enough to stay with AT&T... If this goes through, Verizon here I come.

I would never go to Verizon - even though their service is better, they have to ditch CDMA once and for all. Why are they so reluctant to update to GSM ?

superconductive said,

I would never go to Verizon - even though their service is better, they have to ditch CDMA once and for all. Why are they so reluctant to update to GSM ?

Probably cause GSM is actually older and inherently inferior to CDMA. This coming from a GSM lover too . However, switching to UMTS would have been too costly (IMO).Anyways, they are going LTE so that'll be a plus in that regard, progress is being made finally.

SHoTTa35 said,

Probably cause GSM is actually older and inherently inferior to CDMA. This coming from a GSM lover too . However, switching to UMTS would have been too costly (IMO).Anyways, they are going LTE so that'll be a plus in that regard, progress is being made finally.

+1

I feel sorry for you American's ... we've basically had to endure years and years of "the big three" up here with little competition. It's not fun.

This is a business, were you actually cannot have a lot of competition (we're talking about real providers, not resellers). You have to get back what you paid for your growing expensive mobile network. But an amount of customers is limited...

Owatonna said,
Lame... I would have much preferred them to go with Sprint... This is terrible news.
Well this does eliminate a transition step, since both are GSM.

Voice of Buddy Christ said,
Well this does eliminate a transition step, since both are GSM.

Yeah, Sprint being CDMA would certainly have complicated the transition...

Owatonna said,
Lame... I would have much preferred them to go with Sprint... This is terrible news.
T-Mobile merging with Sprint would be even more stupid.

M_Lyons10 said,

Yeah, Sprint being CDMA would certainly have complicated the transition...

I'll add that AT&T and T-Mobile have different 3G bands.

shinji257 said,
I'll add that AT&T and T-Mobile have different 3G bands.
Exactly.

They do share the same 2G bands though (voice). This is why the iPhone does not run on the 3G network if you unlock it for T-Mobile.

thornz0 said,
has this seen federal approval? I cant imagine how it would be okay without some strings attached...

"In the event of the deal failing to receive regulatory approval, AT&T will be on the hook for $3 billion to T-Mobile -- a breakup fee, they call it -- along with transferring over some AWS spectrum it doesn't need for its LTE rollout, and granting T-Mo a roaming agreement at a value agreeable to both parties."

http://www.engadget.com/2011/0...bile-from-deutsche-telekom/

thornz0 said,
has this seen federal approval? I cant imagine how it would be okay without some strings attached...

That's what I was thinking as well. AT&T is fairly large as is, and isn't really known for their business practices... I'd think this would be scrutinized a bit.

Not sure how I feel about another large wireless provider disappearing from the US landscape...less competition is never a good thing.

bdsams said,
Not sure how I feel about another large wireless provider disappearing from the US landscape...less competition is never a good thing.

I agree but from my friends point of view, they get better and faster speed with this. Of course it wont take affect tomorrow but its an improvement for the current service

bdsams said,
Not sure how I feel about another large wireless provider disappearing from the US landscape...less competition is never a good thing.

I agree.

bdsams said,
Not sure how I feel about another large wireless provider disappearing from the US landscape...less competition is never a good thing.

Don't worry; in ten years the gov't will break them apart for being monopolies.

bdsams said,
Not sure how I feel about another large wireless provider disappearing from the US landscape...less competition is never a good thing.
Blame the stupid US government for allowing such a monopolistic merger to happen.

Tuishimi said,

Don't worry; in ten years the gov't will break them apart for being monopolies.

By your logic, let mistakes happen first, then go back to fix it after all the damage is done. It's like the cops hiding behind the bushes and waiting for some idiot to drive above the speed limit and then let all hell break lose while chasing him. What a ****ing stupid logic. Why study history at all?


This has been going on ever since Bush came into office in 2000, so I am not sure how much I should blame Obama for this since he can't do much being a puppet for the corporations.

Edited by Jebadiah, Mar 21 2011, 6:50am :

Jebadiah said,
Blame the stupid US government for allowing such a monopolistic merger to happen.

By your logic, let mistakes happen first, then go back to fix it after all the damage is done. It's like the cops hiding behind the bushes and waiting for some idiot to drive above the speed limit and then let all hell break lose while chasing him. What a ****ing stupid logic. Why study history at all?


This has been going on ever since Bush came into office in 2000, so I am not sure how much I should blame Obama for this since he can't do much being a puppet for the corporations.

A merger announcement != approval.

Jebadiah said,
Blame the stupid US government for allowing such a monopolistic merger to happen.

By your logic, let mistakes happen first, then go back to fix it after all the damage is done. It's like the cops hiding behind the bushes and waiting for some idiot to drive above the speed limit and then let all hell break lose while chasing him. What a ****ing stupid logic. Why study history at all?


This has been going on ever since Bush came into office in 2000, so I am not sure how much I should blame Obama for this since he can't do much being a puppet for the corporations.

You are 100% right. This has never happened before Bush. All of it started when he was in office. That is why we have such a lack of laws against monopolies. I mean, until Bush came along, monopolies never existed.

Jebadiah said,
This has been going on ever since Bush came into office in 2000, so I am not sure how much I should blame Obama for this since he can't do much being a puppet for the corporations.
Poor guy. He's just the President of the United States. He has no real power thanks to Bush.

This isn't Russia. Our President is not the puppet of the former President (who, himself, was the supposed puppet of his own Vice President). Love him or hate him, Obama is his own man and he has the power to do drop the gavel in whichever direction on this merger.