Guess AT&T Didn't Need T-Mobile to Reach 97% LTE After All
Blocked Deal Winds up Spurring Network Investment
Yesterday AT&T announced their new $14 billion network expansion plan
. The effort involves spending $6 billion to extend U-Verse to 8.5 million additional people, extending slightly-faster DSL to another 25 million, then cutting landlines for about 25% of their footprint -- shoving them toward pricey LTE. While I focused on the wireline aspect of the story yesterday, the LTE expansion promises AT&T made are also worth taking a look at -- and are getting more than a little scrutiny for some fuzzy AT&T arithmetic.
On the LTE side, AT&T is promising to spend $8 billion of their $14 billion network expansion total to extend their LTE network to 300 million covered people by the end of 2014. This expansion will involve using 10,000 new macrocells, 40,000 small cells and 1,000 distributed antenna systems (DAS) across the network footprint.
AT&T says that their LTE network expansion will result in 97% of the customers in the country being able to get the service. David Goldman over at CNN
(who are you and what have you done with CNN?) appears to be the only tech journalist to remember that AT&T insisted they wouldn't be able to obtain the level of coverage without acquiring T-Mobile:
One of the deal's fiercest battle points was 4G access outside major cities. Without T-Mobile, AT&T said it was "very unlikely" that it would expand 4G-LTE service beyond the 80% coverage threshold it already planned to reach by 2013. "In some of these [less-populous] areas, AT&T simply lacks the spectrum necessary to deploy LTE," the company told the Federal Communications Commission in a written defense of its proposal.
The FCC called AT&T's bluff. It released a damning report on the scuttled merger saying it believed AT&T would expand its 4G deployment with or without T-Mobile. AT&T hit the roof, complaining that the FCC's analysis directly contradicted AT&T's "documents and sworn declarations." It got particularly irate about the FCC's prediction -- "based purely on speculation" -- that AT&T would eventually expand its LTE deployment to 97% of the population even if it didn't get T-Mobile.
Fast forward almost a year, and AT&T is suddenly magically able to expand LTE coverage without eliminating a national competitor to do it -- and
for a small fraction of the $39 billion T-Mobile deal price tag. As we noted in the summer of 2011
leaked documents showed AT&T's numbers and claims of spectrum poverty were always nonsense -- and AT&T has struck 40 different spectrum acquisition since that time. Consumer advocates have now spent the last few days laughing at the fact that government regulation spurred network investment, something AT&T policy folk will breathlessly insist simply isn't possible.
After AT&T lost TMO, it acquired a lot of spectrum for LTE They did need more spectrum. They didn't get it from TMO merger in 1 big deal. So they got it elsewhere in many deals. Doesn't mean that they didn't need more spectrum.
To that end, this year alone AT&T has entered into 40 new spectrum deals, some already approved with others still going through the regulatory process. Its an opportunistic strategy, Stankey explains, that will situate AT&T well in the mobile market for the next two years, after that the future becomes a lot more uncertain.
Impeach Obama and tie up government for next 2 yrs
Re: After AT&T lost TMO, it acquired a lot of spectrum for LTE
said by ISurfTooMuch:It may be news to you, but T-Mobile badly wanted to get out of the US market. It's not like they were victims being taken over by an evil giant.
But what they didn't get was to remove a competitor from the market, which is what they really wanted. And not just any competitor but the only other national carrier using GSM/UMTS, which is the only place that disgruntled AT&T users could go without needing to get new phones.
So now instead, we have Germany, UK, and Japan owning/controlling a majority of our cellular market. Oh, and and Mexico/Carlos Slim, since he controls a huge chunk of the prepaid market.
Re: After AT&T lost TMO, it acquired a lot of spectrum for LTE I'm aware that DT wanted out. They felt that T-Mobile USA wasn't performing as well as they wanted. My theory is that this is a problem of their own creation, since they aren't expanding coverage into rural areas, a move that completely eliminates the possibility of getting customers outside big cities and even turns off some city residents who travel to these areas.
However, just because DT was a willing seller and AT&T was a willing buyer, that doesn't mean the deal should have been approved. The reason is that these companies are using a finite, publicly-owned resource: spectrum. They may license it, but it still belongs to us, so they have to receive approval for a deal like that.
As for Japanese, German, British, and Mexican companies owning wireless networks, what's the problem? I have no belief whatsoever that AT&T will treat me any better than them simply because it's based in this country. And, with any publicly-traded company, nationality is an illusion, since, if it's, say, Japanese, and shareholders in the U.S. end up buying a controlling interest, then it's a U.S. company.