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AT&T CEO Got Paycut For Failed T-Mobile Bid
Managed to Scrape By With $22 Million in 2011
by Karl Bode 08:46AM Wednesday Feb 22 2012
According to newly released federal filings, AT&T CEO Randall Stephenson got a $2 million pay cut because of the T-Mobile deal collapse. The filing notes that "named officers" at AT&T all took a slight bonus pay cut related to the T-Mobile deal’s collapse. AT&T did some executive shuffling back in January that included the "retirement" of Forrest Miller, AT&T's head of corporate strategy and mergers and acquisitions. Despite the pay cut, Stephenson still hauled in $22 million in 2011 compensation. AT&T took roughly a $4 billion hit in spectrum, cash and network sharing arrangements with T-Mobile that the telco acknowledged would be closer to $1.4 billion after tax write off. The executive cuts as some investors grumble about the money AT&T pours into politics and their astroturfing efforts, the ridiculousness of which were partially to blame for FCC opposition to the T-Mobile bid.

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IPPlanMan
Holy Cable Modem Batman

join:2000-09-20
Washington, DC
kudos:1

2 recommendations

Tone Deafness

AT&T was completely tone deaf on the DC Politics of this, and it's clear that corporate didn't listen to advice from its DC Public Policy folks on moving forward (or not) in this current economic/political environment.

The way it was handled, this merger never had a prayer. It was laid out as a rush job by corporate that would hopefully be done before anyone really noticed what was happening. The DC Public Policy folks knew better, but had to go along. What a dumb waste of cash and spectrum.
--
"We're going to start at one end of (Fallujah), and we're not going to stop until we get to the other. If there's anybody left when that happens, we're going to turn around and we're going to go back and finish it."
Lt. Col. Pete Newell: 1st Inf. US Army

Karl Bode
News Guy
join:2000-03-02
kudos:42

1 recommendation

Re: Tone Deafness

The DC Public Policy folks knew better, but had to go along. What a dumb waste of cash and spectrum.

Just curious where you heard this?

IPPlanMan
Holy Cable Modem Batman

join:2000-09-20
Washington, DC
kudos:1

1 edit

Re: Tone Deafness

Washington whispers.

Corporate threw a bunch of money at the DC Public Policy folks and said, "get it done before there's a critical mass of opposition". Corporate insisted on speed for competitive reasons (namely lagging in the 4G LTE department), so instead of slowly building a critical mass of support for the merger over time, things went off the rails when the hyper-speed merger ran into resistance....

A critical mass of opposition saw a rush job.

They saw stupid platitudes tacked on like:
Aug. 31: Stephenson says AT&T would bring back 5,000 call center jobs from overseas if the merger were approved.

This was tacked on when the wheels went wobbly...

The timeline this merger ran to failure for was 8 months. There was no possible way for the DC Public Policy Folks to spend the amount of money they were given in that amount of time. However, they did their best, courting every possible organization as quickly as possible. In the process, they courted organizations that would not actually benefit from the merger, but had them trumpet how great it was.

That actually added to the fakeness, but no matter, Corporate wanted to see the money being spent. After all, what are "we" paying these DC guys for?

This merger would have actually succeeded if AT&T had taken its time and generated a groundswell of real support.

And what an interesting coincidence...

Aug. 11: A document by one of the attorneys involved in the deal leaks to public. The document claims it would cost AT&T only $3.8 billion to upgrade its network.

How interesting that that's almost the amount (pre-tax) that AT&T had to fork over to T-Mobile: $3 Billion in Cash and $1 Billion in Spectrum.
--
"We're going to start at one end of (Fallujah), and we're not going to stop until we get to the other. If there's anybody left when that happens, we're going to turn around and we're going to go back and finish it."
Lt. Col. Pete Newell: 1st Inf. US Army

M36

@wideopenwest.com

Re: Tone Deafness

Even with a "groundswell" the DOJ was going to block this merger no matter what, remember their is something called Anti-Trust laws.
en103

join:2011-05-02
Gotta love how the Corporate knows best approach was wrong on multiple accounts.

Bugger

@mycingular.net
Maybe because he is one of AT&T's DC Policy folks. It is hard to imagine that all AT&T people involved with the merger were idiots -- only about 80% of them were

morbo
Complete Your Transaction

join:2002-01-22
00000
Reviews:
·Charter
said by IPPlanMan:

AT&T was completely tone deaf on the DC Politics of this

It is their monopoly "we can do whatever we want" mentality.

IPPlanMan
Holy Cable Modem Batman

join:2000-09-20
Washington, DC
kudos:1

Re: Tone Deafness

Exactly.

Don't forget the cupcakes.

»influencealley.nationaljournal.c···-hit.php

KrK
Heavy Artillery For The Little Guy
Premium
join:2000-01-17
Tulsa, OK
said by morbo:

It is their monopoly "we can do whatever we want" mentality.

It usually works for them too.

This time they may have been too arrogant and offended the powers that be with insufficient trinkets.
--
"Fascism should more properly be called corporatism because it is the merger of state and corporate power." -- Benito Mussolini
BiggA

join:2005-11-23
EARTH
No, it was that the Obama administration (I am normally an ardent Obama supporter, but his administration screwed up here) wanted to look pro-consumer by "promoting competition", and so they made a political pander that wasn't in the best interest of anyone to block the merger from happening.

It is very unfortunate that the political BS blocked it, as it would have hugely helped out the wireless industry and mobile consumers.

moddestmike

join:2009-01-26
Houston, TX

Re: Tone Deafness

ATT sole intention of buying T-Mobile was to eliminate competition. How would this benefit consumers and the industry? It was an awfully arrogant idea for them to try and rush through this. I'm glad the political system worked as intended for once. Did you genuinely believe the whole "we'll add 5,000 outsourced jobs back to the economy" spill?
BiggA

join:2005-11-23
EARTH

Re: Tone Deafness

That is utter BS. T-Mobile is not a competitor to AT&T.

It would have massively benefited consumers as the network would have spectrum synergy and more sites, which would multiplicatively have added capacity, in addition to better coverage. It would have made AT&T great in NYC and the Bay Area. It also would have given AT&T a set of national licenses to build out on, so that they could build LTE nationwide.

It would have created a much more efficient company and network, with more customers to spread the cost of a network build-out on.

There is no room in the market for four world-class 4G providers, there are either 2 or 3 spots.
biochemistry
Premium
join:2003-05-09
92361

Re: Tone Deafness

Are you the most gullible person alive or do you work for AT&T? Verizon has LESS spectrum and they are already nationwide with LTE and expect to complete the buildout by 2013.
BiggA

join:2005-11-23
EARTH

Re: Tone Deafness

They have a lot more. Ever heard of the nice, juicy, fat upper C-block?

Rambo76098

join:2003-02-21
Columbus, OH
Hate to break it to you, but yes, T-mo does compete with AT&T. They are a national carrier. They have 33.7MM customers to AT&T's 108.3MM, or a ratio of 3:1. That's definitely a competitor.
BiggA

join:2005-11-23
EARTH

Re: Tone Deafness

People who want tier 1 coverage want tier 1 coverage. AT&T could de-grandfather everything I have, raise the cost of data, and T-Mobile could be $20/mo for unlimited, and I still wouldn't switch. I want a quality network, with quality coverage, and I don't mind paying for it.

Rambo76098

join:2003-02-21
Columbus, OH
Reviews:
·WOW Internet and..

Re: Tone Deafness

Your experience, wants, and needs != everyone.

If I was a lighter user and/or didn't have a really good discount with Verizon, I'd be on a 2nd tier carrier to save $$. Obvously 33.7MM people get what they need at a price they are OK with from T-Mobile.
BiggA

join:2005-11-23
EARTH

Re: Tone Deafness

The vast majority of the bottom scrapers are already on T-Mo, Sprint, Metro, and Cricket.

HarleyYac
Lee
Premium
join:2001-10-13
Allendale, NJ
kudos:2
Reviews:
·Verizon FiOS
·Verizon Online DSL
·Optimum Online

Times are tough..

I guess the he may have to buy the floor model Bentley and get only one Helicopter pad on his 120 foot yacht instead of 2 THis economy stinks!!!
--
My opinion on religion and science? Science builds airplanes. Religion flies them into buildings.

Camelot One
Premium,MVM
join:2001-11-21
Greenwood, IN
kudos:2

1 recommendation

Re: Times are tough..

I wonder if he will consider himself "under-employed" due to the bad economy.
rradina

join:2000-08-08
Chesterfield, MO

Just Great...

So this guy gets spanked for $2M and instead of investing $4B in U-Verse or wireless, they just flushed it down the drain. Not to mention the loss provides tax incentives that probably cost the government enough money to run a sparsely populated western state.

So AT&T customers will pay and then we'll ALL pay even more.

So how much money does a mistake have to cost before you get canned?
openbox9
Premium
join:2004-01-26
Germany
kudos:2

Re: Just Great...

This isn't a mistake. AT&T was going to win regardless of the acquisition succeeding. I'm honestly surprised more people don't see this.

battleop

join:2005-09-28
00000
If AT&T lost $4B to T Mobile why are people not raising hell that T Mobile is not spending $4B on their network right away?

FastDSL

join:1999-08-22
Snellville, GA

Re: Just Great...

too busy jumping ship
tkdslr

join:2004-04-24
Pompano Beach, FL
Reviews:
·T-Mobile US

Re: Just Great...

said by FastDSL:

too busy jumping ship

The exact opposite is happening, at least at my household.

Now that t-mobile's continued existence is a somewhat longer time-line.
I just brought a nice Samsung Android phone to use with the T-mobile/Walmart $30, 100 min/5GB monthly plan.

Six(6) days.. so far so good.. If all works out I'll be dumping my landline(28$) and crippled DSL(Covad rental) connection.. (reducing at&t's revenues by $35 to $40 a month.)

Right now I'm just looking for a decent web hosting provider to shift my web/email/ftp too.

m35

@wideopenwest.com
Because the parent company Deutsche Telecom is using the money somewhere else besides the USA. The only thing T-Mobile USA got was some spectrum.

IPPlanMan
Holy Cable Modem Batman

join:2000-09-20
Washington, DC
kudos:1
As I mentioned above:

Aug. 11: A document by one of the attorneys involved in the deal leaks to public. The document claims it would cost AT&T only $3.8 billion to upgrade its network.

(Remember that the company was willing to spend 10 times this amount: $39 Billion - on this merger)

Link: »/r0/download/1···/DOC.pdf

See Page 3 for supporting info.

How interesting that that's almost the same amount (pre-tax) that AT&T had to fork over in the fallout to T-Mobile: $3 Billion in Cash and $1 Billion in Spectrum.

What a waste.
--
"We're going to start at one end of (Fallujah), and we're not going to stop until we get to the other. If there's anybody left when that happens, we're going to turn around and we're going to go back and finish it."
Lt. Col. Pete Newell: 1st Inf. US Army

KrK
Heavy Artillery For The Little Guy
Premium
join:2000-01-17
Tulsa, OK
Actually T-Mobile is claiming the are spending money on upgrades. I know they are upgrading cities to HSPA+ network.

For me, I'm glad the merger went south.
--
"Fascism should more properly be called corporatism because it is the merger of state and corporate power." -- Benito Mussolini

dib22

join:2002-01-27
Kansas City, MO

The question is...

What kinda bonus did the tmobile ceo get?

Rambo76098

join:2003-02-21
Columbus, OH

Re: The question is...

Probably none... They wanted the cash for the whole thing to pay down their debt. I don't think T-Mo USA will ever see a penny of AT&T's money, it will all go back to Germany.
wkm001

join:2009-12-14

Holy Cow....

has their actually been some accountability in the telecom industry? If this were to happen again a "trend" could develop.
praetoralpha

join:2005-08-06
Pittsburgh, PA

WOAH!

Usually executives get more money after failures. Stuff like this only happens in Japan. Could this mean a change of business at at&t?

••••••

cableties
Premium
join:2005-01-27

They still got bonuses...

...for failure.

Corporate Execs: greedy old boys club. Protecting the insecure since 1929
--
Splat

KrK
Heavy Artillery For The Little Guy
Premium
join:2000-01-17
Tulsa, OK

Oh man, he's so boned...

Wow, talk about a slap down. Ouch, a 7.33% pay cut. Sheesh better sell the house in the Hamptons.

•••••••