 tiger72SexaT duorPPremium
join:2001-03-28
Saint Louis, MO
kudos:1
 ·T-Mobile US
| reply to battleop
Re: Stephenson partly correct said by battleop:I expect that Verizon and AT&T will become even more competative as they fight for customers. Just don't expect some sort of price war where one starts to undercut the other. They will continue to match each other's moves just like Coke and Pepsi.
Why would they become even more competitive? They will certainly match each other, but if you look at history, ATT and VZW have typically only responded to T-Mobile or Sprint, and then matched each other.
Sprint comes out with WiMax, ATT and VZW declare LTE their next upgrade. T-Mobile deploys 7.2 HSDPA nationwide, ATT responds a couple months later. TMO deploys HSPA+, ATT suddenly begins deploying HSPA+ before they move to LTE. Sprint and T-Mobile cut pricing, a few months later ATT and VZW lower their pricing.
Notice that ATT or VZW are never the first ones to actually come out with anything or alter the market status quo (Save for LTE, but that's due to VZW's 3g data network being utterly unable to compete with HSDPA, much less HSPA+ -- LTE was an implementation of competitive necessity, not to provide its customers additional value: see caps).
The question is: what happens when ATT and VZW account for 85% of the marketplace? What incentive do they have to compete with Sprint anymore, other than to do what they can to drive them out of business?
And when Sprint is gobbled up or files bankruptcy, what then?
It will be *just* like Coke and Pepsi.
They'll have the same pricing. Same general offering. And everyone else (Dr. Pepper, A&W) will either be owned by them, or rely on their distribution.
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"What makes us omniscient? Have we a record of omniscience? ...If we can't persuade nations with comparable values of the merit of our cause, we'd better reexamine our reasoning."
-United States Secretary of Defense (1961-1968) Robert S. McNamara |
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 Steve BPremium
join:2004-08-02
Seattle, WA | Exactly! |
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| reply to tiger72
"Why would they become even more competitive?"
Because they want to be the biggest with the most market share. Competiton does not always mean lower prices. |
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chimera
join:2009-06-09
Washington, DC Reviews:
 ·Comcast
| No, they want the most profits. The trick here is that with a duopoly collusion becomes very, very easy. This can lead to price gouging as both company's investors realize that fighting for market share would be a waste of resources that they would rather take as profits. If you want I can even work out the basic math for you, it's basic economic theory which is why we TRY to outlaw collusion and cartels in the United States. Unfortunately when a field becomes too small (two players) this becomes next to impossible. |
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| reply to tiger72
This is 100% true. If you all want to maintain competition in the industry, YOU are the ones in power to do so by moving your service to Sprint... Especially all of you T-Mo subscribers that don't want to become at&t customers.
By the way, I'm no lawyer, but WHEN the at&t+t-mobile mergers goes through, I'm sure as part of the "conditions" placed by the Federal Trade Commission and Dept. of Justice is that at&t+t allow legacy T-Mobile customers to switch their service WITHOUT a Early Termination Fee (ETF) or Penalty. So for all of you saying that you can't afford the ETF... There will be your chance to jump ship to either Sprint or Verizon (if you want to pay their higher prices). |
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| reply to chimera
I have not said anything that disagrees with what you are saying. I've not said anything that is PRO AT&T or Verizon, I've only said that AT&T and Verizon will strongly compete with each other. The result of this competition will be good for them and NOT the consumer. This competition will have the same effect that the ILECs and Cable cos have had on the indie ISPs. Over time the AT&T / Verizon battle will wear away at companies like Sprint, Cricket, MetroPCS, etc., and one by one they will be swallowed up by AT&T, Verizon, or Sprint. AT&T and Verizon will want for Sprint to stick around so they can always point at Sprint every time someone throws the Duopoly card. |
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