Very few people actually think AT&T's planned acquisition of T-Mobile is a good idea, given it makes an already lumbering and unpopular giant larger -- while eliminating a competitive option in a sector that needs as much competition as it can get. With the deal being so unpopular, it's a very hard sell for the carrier. Fortunately for AT&T, who has contributed more to Congress than any company since 1989, getting regulatory approval will be no problem.
That leaves selling the deal to the public. The last two weeks that has involved AT&T CEO Randall Stephenson conducting a tour of carefully cherry-picked media outlets AT&T knows will conduct softball question interviews. They've ranged from this
giggly, utterly empty interview with Reuters -- to
this interview with USAToday, where Stephenson doesn't even answer the questions asked:
quote:
Q: If the market is so competitive, why might two companies have 70% of the business?A: We all make technology decisions. We all put marketing plans into place. We all make decisions that drive how effective we are in the marketplace. I think we’ve done pretty well. I think Sprint has done a remarkable job over the last couple of years and will do very well tomorrow.
Stephenson just keeps repeating that the wireless industry is "fiercely competitive," despite the fact AT&T and Verizon will dominate 70% of it. When competition does appear in the sector, it tends to be hamstrung by steep ETFs and exclusive handset deals. That's before even getting into AT&T and Verizon's dominance of the special access market, or their political power. Stephenson has also been repeating the idea that the T-Mobile acquisition allows AT&T to engage in a level of "4G" coverage that wasn't possible before, something sector analyst Dave Burstein
keeps debunking:
quote:
AT&T says it will cover 46M more people with LTE by about 2015-2016 if allowed to swallow T-Mobile than theor previous plan, which only went through 2013. That's about 95% of the U.S. population. Based on what AT&T leaders have been saying, I believe their 2015-2016 plans would have been very similar to 46M more, but I have no way of proving that. The net result in improved U.S. LTE coverage: 0%-2%, probably closer to 0%. The U.S. is on track to have 94% LTE coverage in 2013-2014 per the Broadband Plan CITI Columbia University report. Verizon alone is committed to 92%.
None of the main points Stephenson is making in all of these interviews (the deal is patriotic, it helps Obama's
already flimsy wireless goals, it doesn't hurt competition, it's necessary due to
spectrum crisis) are true. That's before we even get to the duplicated job losses we'll see among T-Mobile employees. Or the fact that AT&T already has the lowest customer satisfaction ranking of the big four carriers -- something that's going to get worse with the added headaches of T-Mobile integration. The deal simply isn't in consumers' best interests by any measure, but you'd be hard pressed to see an interviewer from any of the press outlets AT&T selected push Stephenson on this fact.
