AT&T and T-Mobile Merger – what were they thinking?


The Wall Street Journal Online recently posted a story about Jim Cicconi, AT&T’s top lobbyist, and his disappointment (well, he actually had a hissy fit) regarding the FCC’s report on the AT&T/T-Mobile Merger deal. (link to article at the bottom of this post).

What is AT&T thinking.  Right now, in the U.S., where both AT&T and T-Mobile are based, these are the only two major GSM network players of any note and size.  There are some other small regional GSM networks, but when it comes to the overall customer base, AT&T and T-Mobile own the GSM market.  Why would AT&T be surprised that the Federal Communication Commission’s (FCC) report said “no way”.  If the FCC agreed to it, that would be the same as if they said “if you want cable TV at your house, you only have one choice of providers”.  Oh WAIT!!  That’s exactly what we do have.  And that’s exactly why the consumer gets screwed, with no choice in supplier, resulting in price gouging.  That’s why the FCC’s report said it wasn’t a good idea for AT&T and T-Mobile to merge.  Because it would create the same type of monopoly that screwed the public with cable TV.

For those that don’t understand the GSM network issues, I’ll try to keep it basic just so you have the general idea.  AT&T and T-Mobile phones use a SIM card to identify the user, the device, etc., on the mobile phone network.  You can switch to another phone by putting your SIM card in another phone and that’s where your phone will now ring.  You can also go to other countries and buy a SIM card from a local phone company.  That local SIM card would come with so many talk minutes, and a data plan for using the Internet or email (if you have a smart phone like a BlackBerry).  Buying a local SIM card means you can pay significantly reduced rates over what you US based mobile provider would charge you while traveling.  This is a simplified version of the whole picture.

The two big players on the other side of the technology fence are Verizon and Sprint.  They use CDMA technology.  These phones do not require SIM cards in order to function.  But they are not as versatile as a GSM phone.  While CDMA network phone are beginning to have some usability in other countries, it’s still an evolving technology and not something that I, personally, would rely on.

The CDMA mobile phone network and the GSM mobile phone network, are two completely different technologies and never the two shall meet.

With the advent of 4G, the lines between the technology that each mobile carrier uses is becoming blurred.  Each mobile phone network can use 4G LTE and other 4G technologies.  However, AT&T and T-Mobile will still use a SIM card, while Verizon and Sprint will not.

If you, as a consumer, like the options available to you by going with the GSM network phones, you currently have a two main choices, as I said.  AT&T or T-Mobile.  Again, there are other smaller carriers out there using SIM cards but they are not big players in the market.  If AT&T and T-Mobile were allowed to merge, there would be virtually NO COMPETITION and the consumer would have NO OPTIONS if they want a GSM network phone.  It would be AT&T or nothing.

The competition between AT&T and T-Mobile is healthy.  AT&T allows users to multitask even when not in range of a Wi-fi connection.  With AT&T you can talk on your phone (using the speaker phone), while you surf the Internet, check email, look at your calendar, and use other apps on your phone.  With T-Mobile, you can’t, for the most part.  You have some possibilities of multitasking when you are in range of Wi-fi but it certainly is nowhere near the smooth operation of how AT&T does it.  Second, T-Mobile allows the use of Wi-fi to make phone calls; AT&T does not.  Yup, that’s what the current generation of smart phones is supposed to be all about.  Voice over IP (VoIP) calls over Wi-fi.  AT&T’s technology allows it, but AT&T as a company doesn’t.  T-Mobile does.

So, depending on what you want and what you are willing to pay for, you have options.  That’s good for the consumer and can drive prices down; including the prices of devices, and prices of service.  If AT&T and T-Mobile merged, the public would be left flapping in the breeze with only one option for this technology.  Keep in mind that conventional telephone service is controlled as a public utility.  Mobile phone service is NOT.  They can charge what they want, any time they want.  So with only one major company providing a service, the consumer loses.  This is why the FCC does not want to allow AT&T to buy the majority interest (52%) of T-Mobile, thereby creating one big monopoly; regardless of what Jim Cicconi, AT&T’s top lobbyist, says:

AT&T Slams FCC, Says Report on Deal Is Unfair Read more: http://online.wsj.com/article/SB10001424052970204012004577072270368230262.html#ixzz1fOGwhm8P

Your comments are welcomed.

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