AT&T Prepares for T-Mobile Merger to Fall Apart
AT&T Prepares for T-Mobile Merger to Fall Apart
Posted 11/25/2011 at 7:05am
| by Paul Lilly
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AT&T is reportedly taking a $4 billion charge as a precautionary measure in case its attempted merger with T-Mobile fails to win anti-trust approval. By taking the charge, analysts believe it's a clear sign the telecom has lost confidence in the deal going through, and on top of it all, AT&T is said to have withdrawn its application to the U.S. Department of Justice.
On the surface, AT&T is maintaining it intends to move forward with the merger.
"AT&T Inc and Deutsche Telekom AG are continuing to pursue the sale of Deutsche Telekom's U.S. wireless assets to AT&T," the companies said in a statement, according to Reuters.
If that's the case, withdrawing an application likely means AT&T plans to resubmit a revised one, presumably with terms that the DOJ would find more favorable. However, even that part of the process is subject to approval by the FCC, and it can determine if the companies could resubmit an application in the future.
Should the deal fall through, it would be a major mark on AT&T Chief Executive Randall Stephenson's resume. He was so confident in the deal back in March that he offered a break-up package to T-Mobile that includes $3 billion in cash and spectrum for T-Mobile customers to roam on AT&T's network.
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livebriand
November 25, 2011 at 1:28pm
YYYYYYYYEEEEEEEEEESSSSSSSSSSSSSSS!!!!!!!!!!! This merger is nothing but bad for consumers.
someone87
November 25, 2011 at 3:13pm
The worse thing for consumers is that the Governemnt thinks they know best.
The more the Government messes with the free market, the worse our lives will be.
Red Ensign
November 25, 2011 at 6:25pm
Free Market requires competition. Buying up your competition to get rid of your competition is NOT a free market. Your comment implies you have no clue how it is supposed to work. How is eventually (if the Govt doesn't get involved) having a choice between ATT and Verizon better for consumers? Your logic is extemely flawed.
jabelsk
November 26, 2011 at 12:57am
"Your logic is extemely flawed."
Logic? Free markets have nothing to do with the logic of someone's opinion. Neither of you know what you are talking about. Please continue.
Holly Golightly
November 26, 2011 at 12:42am
What AT&T wants to do is become a monopoly again. Thank God the government has the brains to step in and defend the little guys. You know, if AT&T did get this merger, then more people would lose their jobs. As with every merger comes termination of "redundancy" and right now, we can not afford to lose more jobs.
QUINTIX256
November 26, 2011 at 10:13am
Verizon is way too big and sprint-nextel-clearwire has way too much spectrum for AT&T to ever become anything close to a monopoly by this deal. Deutsch Telekom is unwilling to put much more money into T-Mobile's network. If you think AT&T giving T-Mobile customers new phones is bad, an aquisition by sprint-nextel-clearwire will require T-Mobile users to move to a non-GSM network.
The consumer will loose if this deal falls apart.
Peanut Fox
November 27, 2011 at 3:08am
This is true. However, Verizon, Sprint, nor AT&T offer any pricing packages close to T-Mobile.
Though the work required to merge T-Mobile into their respective networks could be the reason Verizon and Sprint have not made a bid for the company themselves. I fail to see what this has to do with the AT&T/T-Mobile acquisition.
Holly Golightly
November 26, 2011 at 1:55pm
Just because AT&T can give every T-Mobile customer a brand new cellphone for free does not mean the customer wins. AT&T is known for their high prices and rather spotty service. T-Mobile is known for their speedy service at affordable prices. This is a business model AT&T is unwilling to accept. Therefore, if AT&T buys T-Mobile, customers lose the option of having fast service at a reasonable price. So customers lose 1 choice, and in the end we would end up paying higher prices as a result.
A healthy market needs strong competition, which is something AT&T wants to finally get rid of. I am confident that if they could, they would buy off Sprint as well and then they would finally merge with Verizon to create 1 "simplified" service. Thank goodness there are stiff government regulations that would defend smaller businesses from evil corporate congolmerates. Remember, the point of a merger is the eliminate the need to compete. They save money while us customers pay them even more. Unfair!!!
Tell me, why do you feel that the customer would lose if the deal falls apart?
alabasterdragon
November 26, 2011 at 3:23am
If the government does something that helps anyone but themselves and the special interest groups that own them, it's by luck or accident. You are required to donate your brains for most government jobs. I would never accuse them of having brains!
You clearly are one of the misguided saps that thinks the government buracracy is here to help.
Holly Golightly
November 26, 2011 at 3:42am
It is within the government's interest to represent their people if they want to stay in power longer. Of course, I am aware of how profitable lobbying is, but originally the government is meant to represent their people. Otherwise, people would backlash, and overrule their own government just like they have overthrown their kings and queens of the past. I guess we are lucky to experience some change... But if they don't change, we have the power to make them change. One revolution at a time. My question is: who is really lucky?
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