Mon March 21, 2011
The Two-Way

AT&T Plan To Buy T-Mobile: Good And Bad News For Consumers?

The news that AT&T plans to buy T-Mobile USA in a deal valued at $39 billion has business reporters writing analyses such as this at MarketWatch.com:

"Assuming the deal goes through, it brings mixed news for consumers, who should benefit from improved quality and coverage in high-speed mobile broadband service, according to Forrester Research analyst Charles Golvin.

" 'The bad news: the cost of that service won't come down nearly as fast as customers would like, since AT&T and Verizon Wireless combined would own nearly three out of every four wireless subscriptions in the U.S.,' Golvin wrote in an e-mail."

The Wall Street Journal adds that "in stitching together the second- and fourth-largest U.S. mobile carriers, AT&T is showing a fearless attitude toward U.S. regulators, who will be heavily scrutinizing what is the largest planned merger deal of 2011. T-Mobile has long been an antagonist to AT&T and chief rival Verizon Wireless, offering low prices that kept pressure on rates."

After the deal, an AT&T/T-Mobile combination would be larger than Verizon Wireless.

Then there's this ripple effect:

"Wall Street stock indexes were poised to rise more than 1 percent at the open on Monday as investors welcomed AT&T's proposal to buy T-Mobile from Deutsche Telekom." (Reuters)

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