AT&T Blows Smoke to Cover Leaked Document Snafu Pretends Damning Letter Offered No New Info Last week a law firm working on AT&T's planned $39 billion acquisition of T-Mobile accidentally shot the company's primary merger benefit talking point in the foot, after publicly posting a largely-unredacted document to the FCC website. AT&T's primary justification for the T-Mobile deal has long been that AT&T couldn't possibly match Verizon's planned 97% LTE coverage without acquiring T-Mobile. Yet the letter (pdf) clearly illustrates that AT&T was unwilling to spend the $3.8 billion it would cost to push LTE coverage from 80% of the country to 97% -- despite AT&T marketing department concerns that this would leave them at a competitive disadvantage to Verizon. AT&T's damage control on the leaked document appears to be to tell news outlets that the letter contained no new information and was "consistent with AT&T's prior filings." Except that's simply not true. The letter clearly illustrates for the first time that AT&T management repeatedly rejected proposals to push their LTE plan from 80% to 97% of the country at a cost of $3.8 billion. This week, AT&T's trying to convince outlets like Politico (the article is buried behind their "Politico Pro" paywall) that the $3.8 billion number is how much the 80-97% coverage bump would cost after the acquisition of T-Mobile: "Our August 8 letter to the commission is fully consistent with and confirms AT&T’s prior filings," said Claudia Jones, a spokeswoman for AT&T. "Simply put, AT&T would not be able to deliver 4G LTE to 55 million more Americans without this merger."...According to AT&T, the $3.8 billion figure refers to how much the wireless build out from 80 percent of the country to 97 percent of the country will cost with acquiring T-Mobile.
This figure is part of the $8 billion investment the company plans to invest if the transaction is approved, AT&T maintains. "This expanded commitment also means that our merger will create many thousands of well-paying jobs by unleashing billions in badly needed investment, both of which are vitally needed given our weakened economy," Jones said. It's fairly astounding, even in the modern age of public relations, that there is absolutely nothing in that statement that's true. For one, we've noted how eliminating T-Mobile will result in an overall reduction in network investment of $10 billion, and that AT&T's job creation claims are inflated if not downright illusory, especially in the face of AT&T's continued landline job reductions. As for the $3.8 billion price tag, the letter clearly states that AT&T executives repeatedly rejected this specific number as too pricey before the merger was proposed: AT&T explained its decision in January 2011 to reject a proposal from AT&T's marketing organization to expand LTE coverage beyond the areas covered by the Plan of Record. AT&T noted that prior to January 2011, senior management had considered and rejected such proposals on numerous occasions, finding each time that there was no viable business case for the proposed expanion. When, in early January 2011, senior management again revisited the decision, it came to the same conclusion. It found that expanding coverage from AT&T's Plan of Record to 97 percent of the U.S. population would require AT&T to almost triple the land mass covered by its LTE network, from below 20 percent of the United States to approximately 55 percent and that providing LTE services to areas outside the Plan of Record would cost nearly twice as much per covered person in capital expenditures. All told, AT&T estimated that this expansion would cost approximately [Begin Confidential Information]$3.8 billion [End Confidential Information]. In the letter, AT&T states their rejection of the $3.8 billion price tag was driven by their belief that their HSPA+ network would be good enough for those remaining 17% of consumers, not because AT&T lacked the resources to make a larger shift to LTE: Given this high cost and AT&T's plan to deploy HSPA+ service to 97% of the population by the end of 2012, AT&T senior management concluded it could not justify expanding its LTE footprint beyond the Plan of Record, despite the potential marketing and competitive benefits of doing so. Specifically, AT&T senior management concluded that, unless AT&T could find a way to expand its LTE footprint on a significantly more cost-effective basis, an LTE deployment to 80 percent of the U.S. population was the most that could be justified. Again, AT&T's clearly saying in the letter that the $3.8 billion total was the number presented to executives before the T-Mobile merger was proposed, meaning that the total would be even less after the deal is completed. The letter claims AT&T executives rejected this $3.8 billion total due to its high cost, yet just a few weeks later were supposedly willing to spend $39 billion -- primarily to achieve the same goal. As we noted last week, this raises serious questions about whether AT&T is sending $39 billion to Germany in order to eliminate T-Mobile and place Sprint in a highly unstable competitive position in the face of AT&T/Verizon 80% market dominance. So not only does the letter contain new data, it demolishes AT&T's claim that they couldn't achieve full LTE coverage without acquiring T-Mobile. AT&T has the resources for 97% LTE coverage -- they make nearly enough in one quarter to achieve this goal. Executives (already under fire for skimping on network investment resulting in the 2009 iPhone PR fiasco) simply didn't want to. They were, however, happily willing to shell out $39 billion to secure market dominance for the next two decades. The FCC has this data since the letter recounts a meeting between AT&T and FCC staffers, so if the agency approves the deal they'll do so knowing full well the majority of its supposed benefits are documented as false.
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 | | ATT are such scumbags My post says it all.Caught now in more than one lie.First they lied and got caught with a document red handed and now they lie again telling us the document was blah blah blah.
I do not like any of these big telcos but I think I have a bigger hate for ATT. | |
|  | acrowl
join:2001-08-08
California, KY | Re: ATT are such scumbags The document was redacted for our viewing only. That means the government has been able to view this document all along in its full form.
This just screws up the public PR campaign that AT&T is attempting. "Hey Mr. Senator, get this approved for us and we will ensure that our PAC slides a little brown envelope under your door next election cycle."
So this little "miss step" will force the government to do more public grandstanding to look like this was a shock to them.
Judge Greene is rolling over in his grave with this nonsense. | |
| | |  N3OGHYo Soy Col. "Bat" GuanoPremium
join:2003-11-11
Philly burbs
kudos:1 | Re: ATT are such scumbags said by acrowl:"Hey Mr. Senator, get this approved for us and we will ensure that our PAC slides a little brown envelope under your door next election cycle." Hey it's all for sale, it's just a matter of price.
Sad, isn't it?
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Petty people are disproportionally corrupted by petty power | |
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| | | I can't stand ATT either. They were caught. End of story. | |
| | | | | Re: ATT are such scumbags said by Geminimind:I can't stand ATT either. They were caught. End of story.
Yes,
They were caught and something serious should be done about it!!
It's not as if they all aren't crooks though. I'm talking about the phone companies, cable companies and government as a whole here.
Something serious needs to be done with it all. 
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The Firefox alternative.
»www.mozilla.org/projects/seamonkey/ | |
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|  n2jtx
join:2001-01-13
Glen Head, NY
 ·Optimum Online
| I agree and as a T-Mobile customer is the reason I do not want to do business with AT&T. I realize companies are in the business to make money (lots of it if they can) but I resent being lied to. I would have more respect for them if they just came out and said "We are buying T-Mobile to eliminate the competition and raise prices. It is all legal and called Capitalism.". Instead they feed us BS and that I cannot stomach.
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I support the right to keep and arm bears. | |
| | | | Believe Verizon is no better. | |
| | | | No takeover. I have been with tmobile since they were Voicestream. No takeover. | |
|
 GooberPremium
join:2000-12-17
Naperville, IL
kudos:4 | Not really astounding "It's fairly astounding, even in the modern age of public relations, that there is absolutely nothing in that statement that's true."
Is it really astounding? The corruption and deception by the tcom biggees is expected nowadays. And unfortunately, it will have no impact on the merger.
Government is bought and sold by these guys. As long as there's donation money to be had, any claims or actions contrary to blessing the deal is a sham and only for show. | |
|  RobIn Deo speramus, God Bless the USAPremium
join:2001-08-25
Kendall, FL
kudos:2 | Guess deal isn't in the bag. The fact that AT&T is going all out because of this leaked document tells me that the merger deal isn't a done deal. | |
| | | ArsTechnica Ars actually had a recent article on how results of a new poll on telecom experts puts AT&T's chances of approval at 50%, down 5% from the last poll (»arstechnica.com/tech-policy/news···eril.ars). I wish more news sites had reported on this gaffe on AT&T's part. If AT&T can just brush it away... sigh. | |
| | | Why Karl has done a very good job explaining that ATT is not buying T-Mobile for the subscribers (although that's certainly nice to have), ATT is buying T-Mobile to ensure that there is a duopoly with them and Verizon for the next decade.
How much would you pay to ensure that happens? | |
| | | | Re: Why There is no duopoly. You people act like Sprint doesn't even exist. Not only is Sprint in a very good position they have incentive to compete on price. As long as Sprint remains in the game there is no duopoly. Sprint will be at a disadvantage for a period until they roll LTE out, but with Lightsquared paying for the upgrade they are very well positioned to seriously degrade pricing and steal customers. Many of you might not even realize that Boost and some of the cheaper prepaid cellular providers are using Sprints network.
Sprint is a very good network these days, after a decade of mismanagement and the botched nextel merger they've finally brought customer service in line and fixed many of their problems. With unlimited data and the cheapest plans in the country they are very well positioned to compete (they also roam on verizon). | |
| | | | | Re: Why Though technically you are correct it is not a full duopoly, if they merge the 2 companies will combine for around 80% market share and Sprint will simply be the bigger player sharing the remaining 20%. So for all practical purposes it will be a duopoly system and those that control 80+% of the market will get to dictate a lot of the market. | |
| | |  whizkid3Premium,MVM
join:2002-02-21
Queens, NY
kudos:8 | said by rahvin112:There is no duopoly. You people act like Sprint doesn't even exist. There is when one looks at the availability of GSM phones & networks. There are only two in the USA - AT&T & T-mobile. American wireless users that need GSM to use their phone worldwide, must pick either AT&T or T-mobile. When only one is left, one can only guess at what the costs for the phones & SIM card accounts will skyrocket to. | |
| | | | | | Re: Why I cannot speak for Sprint, but Verizon has a number of "world phones" which are CDMA / LTE but support GSM outside the US. AT&T would not be the only way to use your cell phone out of the country. | |
| | | | | whizkid3Premium,MVM
join:2002-02-21
Queens, NY
kudos:8 | Re: Why said by wingdo :I cannot speak for Sprint, but Verizon has a number of "world phones" which are CDMA / LTE but support GSM outside the US. AT&T would not be the only way to use your cell phone out of the country.
Understood. But 'supporting' means they can accept a SIM card. You just don't get one with your contract; meaning you typically have to buy a SIM card in the country your visiting; or from AT&T or T-mobile here. Exactly my point. There will be only one provider here. | |
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| | | | Except when you want a signal. Sprint's coverage blows big time. | |
| | | | whizkid3Premium,MVM
join:2002-02-21
Queens, NY
kudos:8 | Re: Why said by Czarembo :Except when you want a signal. Sprint's coverage blows big time.
Very poignantly put.  | |
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| | So, the Death Star is trying to use Jedi mind tricks to convince us? (These are not the 'droids you're looking for.) | |
| Reviews:
 ·MSN
·Brand X Internet
·DSL EXTREME
| It doesn't matter.... It doesn't matter. This merger will go through. Know why? Because NOT ONE mainstream media outlet has picked this BIG story up! Why is that? We all know the answer, don't we: GREED AND CORRUPTION!
Congress wants the $$ that AT&T will bribe them FOR it to go through.
Yesterday I read that the Joplin, MO schools are re-opening, and that the United Arab Emirates has donated every middle and high school student there a laptop. What did our govt. do? Eric Cantor came out and said NO MONEY FOR JOPLIN unless we cut an equal amount from the federal budget. He cares more about his rich buddies then the school kids and others in that devastated community.
Fact is, the uber rich only pay 15% of their income in taxes, while the rest of us pay 35-40%! But that's just fine with the republiturds in Congress.
It's all about corruption today in the Corporate States of AmeriKa! | |
| |  ptrowskiGot Helix?Premium
join:2005-03-14
Putnam, CT
kudos:4 | Re: It doesn't matter.... Close, they donated $500,000 to help them get to their goal of raising $2.7 million for a laptop for each student. | |
| |  cdruGo ColtsPremium,MVM
join:2003-05-14
Fort Wayne, IN
kudos:5
 ·Frontier FiOS
1 edit | said by qworster:Yesterday I read that the Joplin, MO schools are re-opening, and that the United Arab Emirates has donated every middle and high school student there a laptop. What did our govt. do? Eric Cantor came out and said NO MONEY FOR JOPLIN unless we cut an equal amount from the federal budget. He cares more about his rich buddies then the school kids and others in that devastated community. FEMA has already paid out $32m in aid. The SBA has done $38m in loans. This is in addition to private insurance. Nearly 700 federal employees are in the area performing various tasks. The tab of a variety of tasks is being performed by the federal government is expected to be in excess of $262m. Maybe you can read some of the other things that our government did.
Maybe it's me, but getting an entire town literally back on the map seems slightly more important than making sure 2200 laptops are there for the first day of school. I'm sure if they really needed them, they can probably find some old text books in neighboring school districts, counties, or states that could at least get them started.
said by qworster:Fact is, the uber rich only pay 15% of their income in taxes, while the rest of us pay 35-40%! But that's just fine with the republiturds in Congress. Your assertion is not supported with reality. There are always going to be statistical outliers to one extreme or the other, but when looking at the population as a whole, it's not the case. | |
| | | | | | | cdruGo ColtsPremium,MVM
join:2003-05-14
Fort Wayne, IN
kudos:5 Reviews:
·Frontier FiOS
| Re: It doesn't matter.... said by flbas1:http://www.nytimes.com/2011/08/15/opinion/stop-coddling-the-super-rich.html Did you even bother to read the link I posted? I'm well aware of that article. And Buffet's 17.4% is below the "super-rich" average. My link even points to this statistical outlier. Buffet makes reference that he is the lowest in his office, and others range from 33-41%. I'm going to bet that there is more than one person in his office that is regarded as being "rich" and they apparently are paying 33% or more.
83% of the country's households earn less than $100k. Presuming married filing jointly, that's max 17.25% effective tax rate. Filing single, it's 21.68%. And that's before any additional deductions, credits, exemptions, etc. That's just the standard 10-15-25-28 tax brackets. So when qworster said: quote:
the uber rich only pay 15% of their income in taxes, while the rest of us pay 35-40%!
apparently he clearly wasn't referring to 83% of the country when he mentions "the rest of us". | |
|
| Reviews:
·Comcast
·AT&T Southeast
| said by qworster:Fact is, the uber rich only pay 15% of their income in taxes, while the rest of us pay 35-40%! But that's just fine with the republiturds in Congress.
In the top 10 list of Richest Congressman 7 are Democrats, Harman at 435 million, Kerry at 249 million, Polis at 285 million, Warner at 283 million, Kohl at 231 million, Rockefeller at 136 million at Feinstein at 108 million. So maybe you should talk to your Democrap leadership before going after republiturds.. ya know, keep your own house clean. said by qworster:It's all about corruption today in the Corporate States of AmeriKa!
And let me guess, only 1 side has corruption... the one you don't like. | |
| | | | Sorry but no government (not ours, theirs, or anyone elses) should be doing any charity work. That should be left to the compassionate people of the world. | |
| |  mmay149qPremium
join:2009-03-05
Dallas, TX
kudos:48 | said by qworster:It's all about corruption today in the Corporate States of AmeriKa!
Wait, you still think it's Amerika? And not Americant?
Matt | |
| |  old_dawg"I Know Noting..."
join:2001-09-22
Westminster, MD | said by qworster:It doesn't matter. This merger will go through. Know why? Because NOT ONE mainstream media outlet has picked this BIG story up! Why is that? We all know the answer, don't we: GREED AND CORRUPTION!
Congress wants the $$ that AT&T will bribe them FOR it to go through.
Yesterday I read that the Joplin, MO schools are re-opening, and that the United Arab Emirates has donated every middle and high school student there a laptop. What did our govt. do? Eric Cantor came out and said NO MONEY FOR JOPLIN unless we cut an equal amount from the federal budget. He cares more about his rich buddies then the school kids and others in that devastated community.
Fact is, the uber rich only pay 15% of their income in taxes, while the rest of us pay 35-40%! But that's just fine with the republiturds in Congress.
It's all about corruption today in the Corporate States of AmeriKa!
More appropriate for the echo chamber of the Red Room, n'est-ce pas?
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"Our network engineers are aware of the problem..." | |
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| | | getting raped by your carrier sucks the sad part is, they are lining the government's pockets so deep that the merger will still go through.
i really hate you, att.
ih8tt.com | |
| |  japPremium
join:2003-08-10
038xx | Re: getting raped by your carrier sucks said by atth8r :the sad part is, they are lining the government's pockets so deep that the merger will still go through. Not government pockets but pivotal and willing individuals within. If it were for governance we'd all benefit. | |
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| | ¿dónde está el aire caliente?!?!? Anyone else note the LACK of commentary from some of DSLReports key commenting AT&T apologists? | |
| |  fuziwuziNot born yesterdayPremium
join:2005-07-01
Atlanta, GA | Re: ¿dónde está el aire caliente?!?!? said by axiomatic:Anyone else note the LACK of commentary from some of DSLReports key commenting AT&T apologists?
Maybe Mom called them out of the basement for dinner. 
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Apple is the new SCO | |
|
pkorx8
join:2003-06-19
San Francisco, CA Reviews:
·Comcast
·SONIC.NET
| Some numbers to think about There are about 75M att wireless customers currently. If att spent the $39B on these existing customers, instead of buying tmobile, it turns out to be about $520 per customer.
So on a typical 2 year single line contract, $520 is about 25% of the contract.
Heck if att is going to offer a 25% discount to all existing or new customers, i think they will put sprint under, effectively doing what they want to do with this merger. | |
| | |  Why is Sprint's position unstable?
We should have known from the beginning that AT&T's 97 percent claim for LTE was a fig leaf for something more lucrative. So what? Instead of spending your time nitpicking and whining about well-crafted PR arguments, get the government to mandate 100% coverage! We could charge a Universal Service Fee (USF) to make sure it happens. We do that for landlines, why not wireless?
So much fuss about nothing. Basically, the weaker companies are getting swallowed up by the larger ones. Let the free market work and let the survival of the fittest happen. T-Mobile is selling to AT&T because it has been cut off by its German corporate parent. It's not able to make a profit on its own. That's why even if the merger is canceled AT&T will still have to pay T-Mobile money, and they will have a roaming agreement that lets their customers use each others' networks.
Airlines do the same thing when the government prevents them from merging. They keep the brand name in name only to keep regulators and the public happy. But in reality, antitrust concerns aren't really being satisfied. At the end of the day, the big money wins. And now United and Continental are one company, Delta and Northwest, Southwest and AirTran … | |
| | Reviews:
 ·T-Mobile US
·Cox HSI
| Re: Why is Sprint's position unstable? You do realize that T-Mobile USA has never gotten any money from DT, it was actually the other way around, T-Mobile USA is actually decently strong from a financial standpoint, and has always been.. they just have DT digging in their pockets to pay for their failing (and now being sold off/merged EU markets)
DT has always treated T-Mobile USA as a red headed step child and it's always pretty much been on it's own, but in a way it helped as from what i remember personally working for the company for a few years they were an amazing company to their employees that always tried to do the right thing - focus on customer experience as a whole, well that was until Robert Dotson was booted and this Humm guy was brought in, Robert did not want to sell out but DT would not have it any other way and that's honestly why Humm was brought in. | |
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|  TomekPremium
join:2002-01-30
Valley Stream, NY | Monopoly on GSM? I had so many problems with ATT, that's why I went with T-Mobile and was happy with it (till they refused to offer a phone I needed) and then I tried Verizon. However, after my contract expires, I am considering to go back to TMO, but something is telling me that it won't happen....
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Semper Fi | |
| | Reviews:
·Optimum Online
·Verizon FiOS
| Re: Monopoly on GSM? said by Tomek:I had so many problems with ATT, that's why I went with T-Mobile and was happy with it (till they refused to offer a phone I needed) and then I tried Verizon. However, after my contract expires, I am considering to go back to TMO, but something is telling me that it won't happen....
If you dont' travel much outside of the NY Tri-State area, sprint (mvno Boost Mobile) & metro pcs will also have decent coverage... I even recommend a month-to-month prepaid option since you can well-afford a post-paid account...(assumption). | |
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 alphapointeDon't Touch MePremium,MVM
join:2002-02-10
Columbia, MO
kudos:2 | Morons If I wanted smoke blown up my ass I'd have stayed home with a pack of cigarettes and a short length of hose... | |
| | | Surprised? Why? The very reason I stay with T-Mo after leaving AT&T is reflected in this article. AT&T doesn't need the acquisition to build, it needs a way to stop the competition by any means possible. I hope this acquisition/merger is blocked, period. | |
| | | a leaked document, karl bode-a leak,out context = creation Storytelling, not professional reporting effort. Create stir to sell a story. Everyone mature enough to have a home budget, pay monthly bills and plan for retirement, or sending kids to college - have choices. With choice comes an eventual decision - all on the time continuum. | |
| | | Doesn't seem like a problem to me I am an ATT employee and I understand the intent of the article. I have no insider information but offer the following as a potential explanation.
The acquisition of T-Mobile offers not only increased LTE coverage but also increased bandwidth in existing markets that is needed to better support existing subscribers as well as prepare for future growth.
Plus, upper mgmt most likely knew about the upcoming bid for T-Mobile so felt it unnecessary to move forward with LTE expansion given that would be a byproduct of the T-Mobile grab.
Just a thought. | |
| |  WiFiguruTo infinity... and beyondPremium
join:2005-06-21
Los Gatos, CA
·Verizon Online DSL
| Re: Doesn't seem like a problem to me said by Mr_Rhythm :I am an ATT employee and I understand the intent of the article. I have no insider information but offer the following as a potential explanation.
The acquisition of T-Mobile offers not only increased LTE coverage but also increased bandwidth in existing markets that is needed to better support existing subscribers as well as prepare for future growth.
Plus, upper mgmt most likely knew about the upcoming bid for T-Mobile so felt it unnecessary to move forward with LTE expansion given that would be a byproduct of the T-Mobile grab.
Just a thought.
ROFL!!!
Get back to answering support calls. | |
| | |  monchisPremium
join:2002-12-09
Duarte, CA | Re: Doesn't seem like a problem to me said by WiFiguru:said by Mr_Rhythm :I am an ATT employee and I understand the intent of the article. I have no insider information but offer the following as a potential explanation.
The acquisition of T-Mobile offers not only increased LTE coverage but also increased bandwidth in existing markets that is needed to better support existing subscribers as well as prepare for future growth.
Plus, upper mgmt most likely knew about the upcoming bid for T-Mobile so felt it unnecessary to move forward with LTE expansion given that would be a byproduct of the T-Mobile grab.
Just a thought.
ROFL!!! Get back to answering support calls. +1 !!!!
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dslreports.com | |
| | | | | | Re: Doesn't seem like a problem to me +1 | |
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| | Arrggghhh! I loathe AT&T wireless. This whole "lying will make it all better" approach is more or less par for the course here. They make Credo mobile look better and better. | |
| | | Competition is good Any time you combine two companies that overlap in the marketplace there will be a reduction in jobs, not an increase. To those who think otherwise, then we should just let Verizon, ATT, T-Mobile, and Sprint merge into one company as obviously that would create a HUGE surge in jobs! /sarcasm off
The fact of the matter is that towers are expensive and usually don't add new customers or reduce competition. However, buying a competitor does both. The less competition you have, the more you can charge for a product of increasingly inferior quality.
Even at a retail job loss will occur. Why would you need 2 stores that occupy the same geographical location? The solution would be to close the smaller of the two stores and possibly transfer a portion of the employees to the larger store. | |
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2 edits | Re: Competition is good said by myrv :Any time you combine two companies that overlap in the marketplace there will be a reduction in jobs, not an increase. To those who think otherwise, then we should just let Verizon, ATT, T-Mobile, and Sprint merge into one company as obviously that would create a HUGE surge in jobs! /sarcasm off
The fact of the matter is that towers are expensive and usually don't add new customers or reduce competition. However, buying a competitor does both. The less competition you have, the more you can charge for a product of increasingly inferior quality.
Even at a retail job loss will occur. Why would you need 2 stores that occupy the same geographical location? The solution would be to close the smaller of the two stores and possibly transfer a portion of the employees to the larger store.
True. If this deal goes through ATT will do just that. They will have sweeping cost cutting across the board with a task force of project managers looking for each and everything they can to cut corners, service and to fatten up the bottom line for the shareholders. The top execs will give themselves a fat bonus for their hard work. These days, companies don't like to compete the old fashion way. They want to secure markets by buying off politicians or have a legal department like Apple and sue everyone in sight for patent violations. Banks got congress to rubber stamp their bankruptcy bill, content holders bundle channels so individual channels don't have to compete based on viewership/quality for carriages etc.. Oligopolies and monopoles do not like traditional competition and for the most part, don't. | |
| | | | | Re: Competition is good how many 1000's of jobs do you think at&t's previous mergers have cost? Who was in office then? | |
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