Atlanta, GA, March 21, 2011 — These are comments from wireless analyst Jeff Kagan on the announced merger;
This is big news and somewhat of a surprise. We knew Sprint Nextel had been talking with T-Mobile off and on over the last several years. This was the deal we were expecting at some point. However AT&T Mobility and T-Mobile are getting together instead.
At this early stage this sounds like it will be approved and will be good for AT&T Mobility, their shareholders and their customers.
AT&T Mobility has had some problems over the last several years with overwhelming demand for wireless data from customers. T-Mobile is the same technology in the network, but is not upgraded to the same extent as AT&T Mobility. There will have to be quite a bit of money and time spent on upgrading the network, but when that is done I think it will improve the experience to AT&T Mobility customers.
AT&T Mobility has been first to the smart phone dance and has been successful in that area. However the wireless data demands have been hard to keep up with. This should help them in that area.
Because of that improvement I think customers will be happier. Because of that I think investors will be happier.
What’s coming? This is an announcement. Like announcing the engagement of these two companies. Then we have to go through the long approval process. It will take several quarters. We will hear from both sides, pro and con. Ultimately I think it will be approved. It will take a while. Several quarters. I also think AT&T will have to pay a price to get this done. They will have to spin off several assets to companies like Verizon Wireless or Sprint Nextel.
This will take several quarters before it is approved. Then once approved it will take several more quarters to upgrade the T-Mobile network to AT&T Mobility standards. So this is not a quick story. But it will mean AT&T will be a better and stronger company providing better quality to customers.
I don’t think it will have a negative impact on pricing since there will be three players in the marketplace. T-Mobile has been a lower price player so there may be some story here, but I don’t believe it will be enough of a problem to stop the merger. T-Mobile is lower priced, but not that much lower.
If you would like to talk further please email me at email@example.com as I am travelling to Orlando for the CTIA wireless conference.
Other press releases from Jeff Kagan
- Apple iPhone Sales Weaker Than Expected | Jeff Kagan Industry Analyst - January 14th, 2013
- Will FACEBOOK Launch Phone This Week? | Jeff Kagan Industry Analyst - January 13th, 2013
- Nokia Not Out of Woods Yet | Jeff Kagan Wireless Analyst - January 10th, 2013
- Why Microsoft Windows 8 Holiday Sales Were Soft, Jeff Kagan Tech Analyst - January 5th, 2013
- Sprint Nextel Acquiring Clearwire for Wireless Data | Jeff Kagan Industry Analyst - December 17th, 2012
Contact InformationJeff Kagan
PO Box 670562
Marietta, GA 30066
Phone: 770 579 5810