Monday, March 21, 2011

And Then There Were Three

One of the four major cell phone providers in the US has just been bought out by another. T-Mobile was bought by AT&T for a whopping 39 billion dollars. This will make AT&T the biggest cell phone provider in the US. If this mergers passes the FCC, it will give AT&T all of T-mobile's towers, expanding the ranger of their signal in very remote areas. It will also bring with it T-Mobile's 34 million customers. Add that to AT&T 80 million customers to a customer basis of 104 million. That trumps Verizon 94 million customer basis.
When I first heard about this, I didn't think it was actually going to happen. However, AT&T has a little loop whole they found which will allow them to proceed with the purchase.
Picture from Engadget
As you can see, by going through with this purchase AT&T is achieving the goal which Obama set during his State of the Union Adress. The goal is to bring internet and cell phones to 98% of Americans in the next five years. This merger would help accomplish that.
To me, I almost see this as Microsoft is absorbing a company. I get the feeling that, just like Microsoft, AT&T will absorb the company and not know how to handle the customer basis. They will do what they please without any regrets what so ever. T-Mobile has had great customer service, and some phenomenal plans for usage since they were a smaller company. AT&T will probably not follow through with some of these ethics. From what I have read, AT&T has terrible customer service, while T-Mobile's was much better.
I guess it remains to be seen the effects of this merger. This leaves Sprint as the only under dog now. It kind of gives Spring the "OK" to do what they please because they can now charge less then both Verizon and AT&T and still be justified. They would be justified because T-Mobile, their only competition, no longer exist. This also leaves AT&T and Verizon left to duke it out.


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