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AT&T: What Wireless Duopoly?
Wireless Industry 'Intensely Competitive,' Insists CEO
by Karl Bode Thursday 31-Mar-2011 tags: competition · wireless
"This industry is anything but a duopoly," AT&T CEO Randal Setphenson tells the Wall Street Journal, responding to concerns that AT&T and Verizon would own more than 80% of the wireless market after a T-Mobile deal. "The industry is intensely competitive now, and will be intensely competitive after the deal," insists Stephenson. By "intensely competitive," Stephenson of course means a wireless sector utterly dominated by AT&T to the tune of 43%, with AT&T's bottomless lobbying budget resulting in regulatory capture. Stephenson says he sees "good signs" of a "more pro-business stance" from the White House (like buckling to AT&T on network neutrality and common carrier reclassification) Stephenson believes should lead to limited conditions.

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ThrowDemsOut
If you can't convince 'em, confuse 'em
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Stephenson partly correct

quote:
"The industry is intensely competitive now, and will be intensely competitive after the deal," insists Stephenson.
It is very competitive now. But he should have said less competitive after a merger.
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battleop

join:2005-09-28
00000

Re: Stephenson partly correct

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.
gruntlord6

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Barrie, ON
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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.

except coke and pepsi are drinks and not services. Here in canada, all the incumbents run duoploys in all areas ( other then new cell phone entrants in few areas). In these cases, matching each others moves means both of them raising prices at the same time.

battleop

join:2005-09-28
00000

Re: Stephenson partly correct

"Here in canada" Guess what. I don't really care about what it's like "Here in Canada" because I was not talking about Canada. I was talking about AT&T and Verizon who are competing in the USA and not Canada.

I know it sucks that you have been cheated out of your birth right to 10Gb uncapped service for $2/year but enough is enough.
Eldorados

join:2005-11-25

Re: Stephenson partly correct

said by battleop:

"Here in canada" Guess what. I don't really care about what it's like "Here in Canada" because I was not talking about Canada. I was talking about AT&T and Verizon who are competing in the USA and not Canada.

I know it sucks that you have been cheated out of your birth right to 10Gb uncapped service for $2/year but enough is enough.

Love the arrogance

Here's a clue - big corps are the same, whether they are in Canada or the US.. don't think these guys don't take notice in what's happening on the other side of the boarder

Simba7

join:2003-03-24
Billings, MT

Re: Stephenson partly correct

said by Eldorados:

Here's a clue - big corps are the same, whether they are in Canada or the US.. don't think these guys don't take notice in what's happening on the other side of the border

That is true. Some are watching it happen here, but most customers just don't care until they receive their bill or finally realize they no longer have a choice between providers.

The lobbyists have finely crafted the laws to be in favor for huge businesses. Do you think what happened to AT&T in 1984 actually stopped them? No. They just figured out ways to get around it. Sure it took them almost 25 years, but now they can do whatever they want.

If you want choice and change, do this quote (from a specific movie): "Time to nut up or shut up".
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ackman

join:2000-10-04
Acworth, GA
said by battleop:

"Here in canada" Guess what. I don't really care about what it's like "Here in Canada" because I was not talking about Canada. I was talking about AT&T and Verizon who are competing in the USA and not Canada.

I know it sucks that you have been cheated out of your birth right to 10Gb uncapped service for $2/year but enough is enough.

What an ignorant and closed-minded individual you are. Let me guess, you're a conservative?

battleop

join:2005-09-28
00000

Re: Stephenson partly correct

LOL..... WTF does this have to do with politics? Not every post is segway to bitch about the current state of broadband in Canada.

We all know and understand it sucks. Anyone who is upset about broadband in Canada is preaching to the choir here, so stop trying to work the "Poor us in Canada" bit in to every thread.

tiger72
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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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Steve B
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Re: Stephenson partly correct

Exactly!

battleop

join:2005-09-28
00000
"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.
chimera

join:2009-06-09
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Re: Stephenson partly correct

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.

battleop

join:2005-09-28
00000

Re: Stephenson partly correct

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.

GoUnderDog

@sprintlink.net
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).

jslik
That just happened
Premium
join:2006-03-17
said by battleop:

They will continue to match each other's moves just like Coke and Pepsi.

Yes, but I have LOTS of choices for beverages besides those two. Wireless services after this merger? Not so much.
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BiggA

join:2005-11-23
EARTH
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I totally agree. They will become more competitive, not on price (that's for Metro/Sprint/USCC), but on features, speed, coverage, phones, amount of data, etc etc.

Right now they are pretty close to a deadlock, but after this, they won't be. This will throw the duopoly out of balance and, in the end, create a better environment for the consumer.

tiger72
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Re: Stephenson partly correct

said by BiggA:

I totally agree. They will become more competitive, not on price (that's for Metro/Sprint/USCC), but on features, speed, coverage, phones, amount of data, etc etc.

Right now they are pretty close to a deadlock, but after this, they won't be. This will throw the duopoly out of balance and, in the end, create a better environment for the consumer.

More competitive?
If that's the case, can you explain ATT's lowering of its "unlimited" data to an industry-low 2GB cap? Or Verizon's statements regarding implementing data throttling? Or ATT's removal of sideloading on Android handsets? Or ATT's removal of HSUPA support for its "4g" handets? Or VZW's repeated overbilling "mistakes"?

Yeah, you're right. They're totally competing already, and that competition sure is intense.
--
"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
BiggA

join:2005-11-23
EARTH
Reviews:
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Re: Stephenson partly correct

AT&T's data plan is more consumer friendly, as it is $5 cheaper with no reduction in functionality unless you're a network abuser.

Verizon should go over the 2GB system, they wouldn't be forced to do sleazy throttling stuff. Problem is they probably want that extra $5.

I have side loading and HSUPA (which is probably the most useless and boring feature ever anyways) on my Captivate. I technically use HSUPA even though I couldn't care less about that, and sideloading is an issue of principle, since I have no use for it until I start developing apps.

Simba7

join:2003-03-24
Billings, MT

Re: Stephenson partly correct

said by BiggA:

AT&T's data plan is more consumer friendly, as it is $5 cheaper with no reduction in functionality unless you're a network abuser.

Network abuser? I'd like you to define "Network abuser" for us.
said by BiggA:

Verizon should go over the 2GB system, they wouldn't be forced to do sleazy throttling stuff. Problem is they probably want that extra $5.

Yep. For that extra $5, I get 5GB (vs 2GB). I have a D2G so I have unlimited data, which I definitely use every month without overages (or VZ griping at me).

So, 3GB cost $5? I wonder if at&t would approve of that.
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BiggA

join:2005-11-23
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Re: Stephenson partly correct

A network abuser wastes bandwidth, streams video over 3G, downloads large files that they don't need to download over the mobile network, etc. I use my phone A LOT, EVER DAY and my record so far is 800MB. I stream Pandora, I use GPS with satellite images, I do a ton of email, mobile Googling stuff, Dropbox access, Mobile Facebook uploads, etc etc. Heavy usage is for wifi.

Simba7

join:2003-03-24
Billings, MT

Re: Stephenson partly correct

said by BiggA:

A network abuser wastes bandwidth, streams video over 3G, downloads large files that they don't need to download over the mobile network, etc. I use my phone A LOT, EVER DAY and my record so far is 800MB. I stream Pandora, I use GPS with satellite images, I do a ton of email, mobile Googling stuff, Dropbox access, Mobile Facebook uploads, etc etc. Heavy usage is for wifi.

What is a "waste" of bandwidth. Bandwidth is technically never wasted. It is utilized for different tasks. The tasks could be whatever you *PAID* it to do. If I paid to do certain things on my phone, I'd expect to get my money's worth and not be restricted to what the carrier wants me to do with *MY* phone.

..and download large files I don't need. Well, if I didn't need them, I WOULDN'T BE DOWNLOADING THEM. If I'm working on a computer that needs a driver pack (that doesn't have access to the 'net) I'm going to fetch it and install it on that computer (ahh.. MicroSD Cards).

..and streaming video. What's wrong with that? If I want to relax in the middle of nowhere and watch a movie on *MY* phone, I should be entitled to do so. Same with a Video Chat with my family. You stream Pandora (usually around 128kbps) and upload/download random stuff to the 'net. Are you wasting bandwidth?

As for WiFi, why would I use my own network? That's basically paying 2 ISP's to do the same thing. The funny thing is, free WiFi isn't *EVERYWHERE*. Ever try to hop onto an encrypted AP without the key? Ever try to find an AP in the middle of nowhere? Ever use an AP on the road?
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BiggA

join:2005-11-23
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Re: Stephenson partly correct

Why on earth would a computer not be connected to the internet or be near one that is?

Video is a waste of bandwidth on a mobile network. There is no need for it, use wifi or wait to see the latest stupid YouTube video. If you want a movie, load it on your iPod from your computer and then you can have it without wasting network bandwidth and having a bad user experience from trying to cram something over a network that was never built for it.

Wifi, because you have to have internet anyways. Since when you do you have to pay more to use your phone on your existing wifi and home internet connection?

No one needs to stream video in the middle of nowhere. Get a grip. Even if I had unlimited, I wouldn't want to waste my time trying to get my phone to have a decent quality video experience and waiting for loading and buffering and such, and then kill my battery. It's just a bad idea all around.

Simba7

join:2003-03-24
Billings, MT

Re: Stephenson partly correct

said by BiggA:

Why on earth would a computer not be connected to the internet or be near one that is?

Because the internet isn't EVERYWHERE, even most claim it is. Ever been to a small rural town? I doubt they've heard of WiFi, let alone Broadband. Also, some secure systems aren't allowed on the Internet for good reason. But they still need updates and drivers.
Let's see how far you get if you tie a Classified workstation into the Internet to fetch an update. I bet your ass will be in front of the CO within a matter of seconds.
said by BiggA:

If you want a movie, load it on your iPod from your computer and then you can have it without wasting network bandwidth and having a bad user experience from trying to cram something over a network that was never built for it.

Then I guess they'd better stop advertising that it can, huh? I've seen sh*tloads of commercials talking about their phones supporting streaming video and how much better their network is because it can handle it. Are you telling me that they are full of it?
said by BiggA:

Wifi, because you have to have internet anyways. Since when you do you have to pay more to use your phone on your existing wifi and home internet connection?

*facepalm* Nevermind. You completely missed my point about half a decade ago.
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BiggA

join:2005-11-23
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Re: Stephenson partly correct

A place with no DSL or cable but AT&T 3G. Where is THAT???

If you need to transfer drivers onto a classified machine, use an unclassified machine that has internet access, and flash drive it over. I would think that's something that IT has to do, considering it's not very secure, but then again you're talking about putting your phone's SD card in the machine, so flash drives to another computer isn't any less secure.

They do have a marketing issue with that. They're advertising capabilities that more or less constitute network abuse.

What on earth is your point then?

Uncle Paul

join:2003-02-04
USA
kudos:1
I don't think I would describe the current market as 'intensely competitive'. More like mildly competitive in certain areas they choose to compete in. Price typically isn't one of them.

MSauk
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said by ThrowDemsOut:

quote:
"The industry is intensely competitive now, and will be intensely competitive after the deal," insists Stephenson.
It is very competitive now. But he should have said less competitive after a merger.

Are you being sarcastic about it being competitive now? I can't really tell. I hope you are to be honest.

Competitive ran out the door about 10 years ago. Prices are out of control and not sure if you have noticed but just about every cell company has the same pricing. How is that competitive?

Text messaging went from being 5 dollars a month, which is fair, to 20 dollars a month for the same service.

The market is not competitive at all, just like the airline industry.
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axiomatic

join:2006-08-23
Tomball, TX

Re: Stephenson partly correct

I have to agree with MSauk here.

Being a level 3 network engineer on the "inside" of the business the costs for the same old services have become almost comical. Whats worse is that executive pay is WAAAAAYYYYY up while "worker bee" pay has either flat-lined or declined and that is not even considering how much more is being outsourced than used to be.

Executive greed is out of control and everything is geared to making the shareholders happy. A company can only be successful while doing this for a short time. People are leaving my company in droves due to this disparity as well only to be replaced with more outsourcing.

It's about the most un-American thing I have ever witnessed.
sonicmerlin

join:2009-05-24
Cleveland, OH
kudos:1

Re: Stephenson partly correct

said by axiomatic:

I have to agree with MSauk here.

Being a level 3 network engineer on the "inside" of the business the costs for the same old services have become almost comical. Whats worse is that executive pay is WAAAAAYYYYY up while "worker bee" pay has either flat-lined or declined and that is not even considering how much more is being outsourced than used to be.

Executive greed is out of control and everything is geared to making the shareholders happy. A company can only be successful while doing this for a short time. People are leaving my company in droves due to this disparity as well only to be replaced with more outsourcing.

It's about the most un-American thing I have ever witnessed.

Your response is the kind Uncle Sam will never, ever reply to. It's far too hands-on and clashes his ideology with reality.

FreedomBuild
Well done is better than well said
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said by ThrowDemsOut:

quote:
"The industry is intensely competitive now, and will be intensely competitive after the deal," insists Stephenson.
It is very competitive now. But he should have said less competitive after a merger.

Agreed, but part of the requirement for getting fat bonuses is downplaying the real truth
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sonicmerlin

join:2009-05-24
Cleveland, OH
kudos:1
said by ThrowDemsOut:

quote:
"The industry is intensely competitive now, and will be intensely competitive after the deal," insists Stephenson.
It is very competitive now. But he should have said less competitive after a merger.

No it's not. The FCC's own HHI puts the wireless market in its current form as dangerously close to requiring DOJ/FTC intervention.

mob
Moderhated
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I was once on my way to being a CEO

Then I went to rehab.

ropeguru
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Grafton, WV

Re: I was once on my way to being a CEO

said by mob:

Then I went to rehab.

And actually grew into maturity.

DaveDude
No Fear

join:1999-09-01
New Jersey
kudos:1

Time to breakup ATT part 2

Why is it that Europe is a more competitive enviroment then the USA ? ATT needs to be broken up again , along with Verizon. There needs to be more competition not less.

Simba7

join:2003-03-24
Billings, MT

Re: Time to breakup ATT part 2

Good luck with that. at&t learned from the last time they were broken up.
Neosum
Premium
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Oakland, CA
Reviews:
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Government needs to sit back and let these companies duke it out. Look what happened when they broke up PG&E. Rates soared sky high despite dozens of electric companies popping in, EVERYONE's rates were higher than PG&E before the break up.

Mobile services are a privilege not a right. No one's forced to sign any contracts with these carriers.
flbas1

join:2010-02-03
Fort Lauderdale, FL
Reviews:
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Re: Time to breakup ATT part 2

unfortunately, the carriers have locked it up so that no one else can enter the market.

I can't (easily) run fiber to my neighbors and call it an ISP - that is anti-competitive.

And, I can't obtain spectrum to run a wireless service - the big boys gobble all of it up.
VansHSI

join:2005-01-29
America

Time for people to get serious

A lot of complaining will go on in this thread from different people on how this is so will have negative implications on the overall wireless market. And then you all will go back to using your ATT phone...

speak with your wallet and do something about it.

GoUnderDog

@sprintlink.net

Re: Time for people to get serious

+1...

Which in this case... All of you T-Mo customers don't like where the ship is headed?... go to Sprint.
sonicmerlin

join:2009-05-24
Cleveland, OH
kudos:1
said by VansHSI:

A lot of complaining will go on in this thread from different people on how this is so will have negative implications on the overall wireless market. And then you all will go back to using your ATT phone...

speak with your wallet and do something about it.

If everyone on DSLReports switched from AT&T to Sprint or Verizon, AT&T wouldn't even notice the dink in their pockets.

Never has a coordinated boycott ever worked in the history of the US, in large part because we are such a massive country with with a wide array of disparate interests.

Van
Premium
join:2009-07-08
New Orleans, LA

Not a shocker. His statements pretty

much are the way most higher ups talk about their ISP's

They throw out general views with no facts or substance and they hope it sticks. Add in a few million for lobbying and suddenly their view, which completely destroys consumer protections, is law and the ISP profits rise.

Same old, Same old
waiting4fios

join:2005-04-08
Howell, NJ

at&t has already bought their approval

"Stephenson says he sees "good signs" of a "more pro-business stance" from the White House (like buckling to AT&T on network neutrality and common carrier reclassification) Stephenson believes should lead to limited conditions."
In other words he is saying the politicians have already cashed the check at&t sent them.

spewak
R.I.P Dadkins
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Elk Grove, CA
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You say something enough

You start to believe it!
VerizonCynic

join:2006-10-25
Lakewood, CA

why do companies merge?

1. to eliminate a competitor that may merge with another competitor and so they can stop racing to the bottom on pricing due to competition with each other

2. So that the top 10 stockholders in the co can make a killing as well as the few bankers and insiders on the deal...

Again show me a merger that resulted in lower prices and better service after as opposed to before the merger

I know its sounds communist to tea partiers (who already have their nest egg) but I cant see that any merger should ever be allowed where one of the cos merging has more than 30-40% of the market

See 7 replies to this post
djhexer

join:2002-10-07
Reno, NV

The industry is intensely competitive now....

Uhhhh NO. if you look at who runs postpaid on a national level
T-Mo
AT&T
Sprint

Yes Cricket and MetroPCS have their own network build BUT they are not fully national, as in you cannot take their phones out of the home market and make a call w/o incurring roaming charges.

You have to remember that the Virgins, Boost, Wal-Marts Stright Talk AND Walmart Wireless, Tracfone, Net10 etc RUN on either AT&T or VZW networks.

So it is a DUOpoly already. Once the merger is through and Sprint goes under, forget affordable wireless in a whole.

I know there are many other small companies out there like U.S Cellular BUT on a national level they are not. I live in NV and could not get a U.S cellular phone with a local number, yes I can use it here but my number would be out of idontknowheresville ID.
Neosum
Premium
join:2000-06-03
Oakland, CA
Reviews:
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Re: The industry is intensely competitive now....

They're in the business to make money, period. Cricket and metro pcs are not fully national because it costs time and money (something they don't have a surplus of) to expand. If everyone expects cheap prices, then coverage is compromised and expansion is slowed.

I'd like to see these people try and run their own company on the basis of providing excellent products/services at dirt cheap prices. $10/mo for unlimited voice/data/txt and global coverage? How about that? I'll sign a 10 year contract for that.
VerizonCynic

join:2006-10-25
Lakewood, CA

Re: The industry is intensely competitive now....

True but lets look at the pay and stock options and other benefits of the top 30 people at each phone co and look at what % profit each phone co invests back into hard infrastructure vs say ....oh I dont know lobbying and campaign contributions....or "astroturfing" activity like the Koch brothers
Neosum
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Oakland, CA
Reviews:
·Pacific Bell - SBC

Re: The industry is intensely competitive now....

Don't you wish you were on of those top 30? I definitely do. 100% of the $39 billion would go into infrastructure and business expansion in this case. The money's being spent to buy another company (spectrum/assets). What tmobile owners do with that money is their business. They would then no longer be in the wireless business.
wbertram
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Allentown, PA

Attn: Karl Bode

While I generally enjoy your posts, I am highly offended by your associating the "Bell System - Long Lines Department" logo with the present abomination known as AT&T! The Long Lines Department and it's employees honorably served this country for many decades, providing this country with state-of-the-art long distance telecommunications technology. You dis-honor those people by placing that logo on these pages!
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·PHONE POWER
·Time Warner Cable

High Barriers to Entry

This is becoming a government sponsored mercantilist activity, which of course made America great, however when this was originally done, it was against other countries to the benefit of Americans, the issue is now instead of enriching Americans, it is taking from them, which means our government is no longer acting in the citizens best interest.

I was thinking how possibly it could cost Verizon $10/GB to provide data, and when they deploy their LTE environment the cost will probably be similar to wireline plus the FCC spectrum vig that everyone pays.

In the meantime these guys are buying out hosting providers so they can run their own little cloud empires.

The richest person in the world is a telecom henchman out of Mexico, and we are not talking about a rich country like America, so you can see how this corporate grab for peoples remaining money can happen on a grand scale in a less economically robust country. I was just down in Mexico, man you should see how expensive mobile is down there.

Prepare to make some hard decisions (I know nobody will), but my wife has prepaid and we spend $18/month with 2000 texts (she does 1000) which is entirely affordable considering that it probably cost Verizon $2, but that is for another day.

Because nothing is made in America anymore, it is natural for big corporations to kill services and milk them while technology has made communicating with other humans practically free.

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