In AT&T & T-Mobile Merger, Everybody Loses | Hacker News Reader

In AT&T & T-Mobile Merger, Everybody Loses

gigaom.com

124 pointsalecperkins30 comments

This makes me want to cry. AFAIK T-Mobile is the only US carrier that actually allows you to save money by not subsidizing your handset purchase. I saved $20 off of T-Mobile's already reasonable monthly rates by buying my Nexus One upfront.

More importantly, the phone is unlocked. When I travel abroad, I can simply pop in a prepaid SIM card and I'm set. How many phones does AT&T sell that aren't SIM-locked to their network?

I left AT&T for T-Mobile years ago, because AT&T's customer service is terrible while T-Mobile's is excellent. I won't give AT&T my money ever again, but my choices keep narrowing.

I doubt that I'm alone, which means that Verizon could easily "not lose" contrary to the title of the thread.

When I see posts such as this, I wonder what problems were encountered that required engagement with customer service, and what the expectations were. If the expectations were unreasonable, customer service is certain to get a bad rep.

I've never had problems with AT&T's service which I use for two landlines, an iPhone and an iPad. I've had the landlines, and made changes to them, for over ten years. I've had multiple T1s with them over the years as well.

I'd settle for them managing to bill me properly for my POTS line after no more than 3 tries (it took 6 after my most recent move).

My experience is that AT&T's level one support is excellent, their level two support is mostly ok, and their level three support is /dev/null.

I left because Verizon because it cooperated with warrant-less wiretapping (as did AT&T) and T-mobile did not.

Now I'm screwed because I have a Nexus One so I'm basically locked in. I bought the phone without a contract but it's not like it works with other networks.

I went with voicestream(t-mobile) to avoid the major telcos in the U.S. Once it became t-mobile, they still behaved better than the others. About mid-year last year they started behaving much like the incumbents, so I switched over to Virgin mobile(Sprint Network). It seems the lesser evil at the moment. The network has been great for me and the prices even better.

Virgin's customer service is hit and miss. I have had some reps bend over backwards for me and others just shrug me off.

I will do whatever I can to not deal directly with one of the incumbents.

The problem is this depends on the person/situation. I had the opposite problem. Tmobile coverage in my area was terrible and the customer service was absolutely horrible! Also, the at&t coverage in my area is great and I almost never get a dropped call though they can be on the pricey side when it comes to plans.

But I am currently in a wireless communications class and am still blown away by how much goes on behind the scenes of cell phone towers. People get upset about a dropped call now and then but the tech is pretty amazing. Then again I feel ALL Telco comPanies have dropped the ball on their infrastructure.

Well, at least Deutsche Telekom is probably happy to finally get rid of their stupid adventure in North America. They bought for 51 billion dollar eleven years ago, they are selling now for 39 billion dollar — all things considered probably not a bad deal.

Hm - Wikipedia tells me Deutsche Telekom bought what was to become T-Mobile USA in 2001 for $24B. After inflation, that's around $30B in 2011. Where is the $51B figure coming from?

German press: http://www.sueddeutsche.de/wirtschaft/verkauf-von-t-mobile-u...

Edit: So, I checked where that 51 billion is coming from. The German T-Mobile International article quotes 39.4 billion Euro and references the 2001 annual report, page 131. Here it is (2.4MB PDF monstrosity and German): http://www.download-telekom.de/dt/StaticPage/47/29/gb_d_komp...

The relevant passage (German): „Am 31. Mai 2001 erwarb die Deutsche Telekom je 100 % an der VoiceStream Wireless Corporation, Bellevue, und der Powertel Inc., Bellevue, zu einem Gesamtkaufpreis von 39,4 Mrd. € inklusive einer Cash-Komponente von 4,9 Mrd. € und einer von der Deutschen Telekom bereits im September 2000 getätigten Investition in Vorzugsaktien von VoiceStream in Höhe von 5,6 Mrd. €.“

That passage basically says that they bought 100 percent of VoiceStream and Powertel for together 39.4 billion Euro.

Well, we are still no closer to finding out what caused the discrepancy — maybe the Wikipedia article is simply wrong?

Intriguing - googling around I also saw the $51B number mentioned in http://www.networkworld.com/news/2011/032011-att-tmobile-acq..., and in contemporary articles http://www.photonics.com/Article.aspx?AID=6715 and http://www.economist.com/node/449273 - but interestingly both appear to be written before the deal closed. On the other hand Wikipedia offers no citations for the $24B number.

This is a massive discrepancy - wonder where it's coming from...

edit: the $24B figure was introduced into Wikipedia in July 2007: http://en.wikipedia.org/w/index.php?title=T-Mobile_USA&d... and not challenged since. On the other hand the main T-Mobile article gives a $50.7B figure with a citation. I [citation needed]-ed the $24B claim, let's see where it goes.

According to the NYT at the time, the deal was valued at about $34B: http://select.nytimes.com/gst/abstract.html?res=F10B16FC3E5D...

While they overpaid (in the tech boom who didn't?), to be fair T-Mobile USA has generated billions in profits annually for a while which eases the pain a bit. Plus they're getting a decent chunk of AT&T, which should be in a really good place with T-Mobile out of the way. Mostly I think this was so they didn't have to spend the capital for a full LTE network upgrade, which would be quite an outlay.

Another company leaving the impossibly corrupt and broken US cell marketplace.

Very interesting piece though weirdly doesn't mention Apple (at least as of right now, maybe he'll update?). Plus for Apple is access to more customers for iPhone though right now T-Mobile 3G network is incompatible with GSM/3G version of iPhone. Downside is greater bargaining power of AT&T and Verizon as carrier space consolidates.

But with regards to Google, it seems kind of silly to suggest tiny, market-share losing T-Mobile was all that stood between the carriers hijacking Android and nirvana. Google's biggest bargaining chip with carriers is the inclusion of very popular Google Android services like mapping, voice to text etc. And Verizon and AT&T seem pretty high on Android to prevent Apple from gaining too much sway.

Lots more to come on this one...

Hmmm it is funny that Apple isn't mentioned, given its influence in the hardware side.

A general suspicion has been that Apple will open up the iPhone to other carriers with the next rev. I wonder if this will impact that plan at all (if it exists).

Now, they don't need to expand the carrier offering to increase the customer base. But, it's a greater customer base entirely within AT&T. But, AT&T will now — presumably — have better coverage. But, AT&T is already strongly disliked as a brand, and this doesn't change that. And so on…

I would think that Apple is at best wary of the merger, since, like the rest of the hardware providers, the increased bargaining power of the carriers is a problem.

Long-term ATT'll have better coverage, but for now, not so much. Basically they (that is, existing ATT customers) get T-Mo's 2G/EDGE network, but that's about it. 3G is still on two different channels, so ATT/T-Mo customers are still split there. ATT's 4G network is nonexistent, while T-Mo's is brand-new and tiny. Moving forward, as they build out 4G, this is a net win, but the merger doesn't help anyone's 3G coverage.

Ugh... I hate this. I really don't want to be an ATT customer.

I always thought that these problems exists only in the developing nations, but alas.

Does this mean I will now have an additional array of cell towers to boost my otherwise crappy reception? Will this result in load balancing for AT&T's overwhelmed 3G network?

Yeah. That's where he's wrong. Existing AT&T customers are going to come out far ahead from this deal.

But our wallets likely won't.

I disagree. As it stands both AT&T and T-Mobile are starved for spectrum. That renders them (especially T-Mobile) unable to compete effectively with Verizon. How can you compete on price when you can't deliver the level of service your customers expect?

T-Mobile's phones operate on a different frequency than AT&T. I don't see them merging the two networks. Chances are that T-Mobile's network will be put in maintenance mode, with any new customers receiving phones on AT&T's frequencies, until the LTE transition is complete and AT&T can shut down the T-Mobile network. It may be a boon for existing T-Mobile customers, who will presumably be able to use multi-band GSM phones on AT&T without roaming fees.

Putting AT&T-frequency radios on previously-T-Mobile towers is a relatively low-cost possibility that would help with AT&T reception/bandwidth, although that will probably have to wait at least a year or so until the back-end routing systems are merged.

That's true. I imagine the regulatory hurdles to add radios to existing towers is orders of magnitude lower than building new towers. Might be a win for AT&T in cities where T-Mobile has good coverage.

I was under the impression that GSM phones support multiple frequency bands - why not just adjust the base station configuration so phones can roam between the two networks?

The 3G bands used by T-Mobile and AT&T are different and generally not supported on the same device. For example there was a T-Mobile version of the N1 and an AT&T version of the N1. They both work on the others 2G network, but not on the 3G network.

Apple and iOS developers will probably win with this.

Why? T-Mobile isn't getting the iPhone, so they aren't getting access to any new subscribers.

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