"In a time of universal deceit telling the truth is a revolutionary act." -George Orwell

Posts Tagged ‘T-Mobile’

AT&T Chief Says DOJ Blocked Merger With T-Mobile Will Cost Its Consumers More

In Uncategorized on May 5, 2012 at 4:22 pm

Oldspeak: “Since that deal got killed, our data prices have gone up 30%,” he said. He also blamed the blocked T-Mobile USA deal, in part, for AT&T’s decision earlier this year to impose a limit on the amount of data available to a given customer. However, he said such a move probably would have been necessary regardless of the decision, and that he regretted not imposing the cap sooner.” Austerity measures, affect you in more ways than you think. How bout that. The merger doesn’t happen, so they jack up prices to increase their perceived lost potential profits. And the argument for corporate consolidation and less choice perfectly crystallizes some of the fundamental flaws with oligarchical capitalism.  In the minds of terminal ill Capitalists, More for me, less for you = More for me, more for you. Your basic 2+2-=5 logic. This insatiable lust for more, and the idea that it is good, unbridled greed;  it is unsustainable and certainly catastrophic for our planet, and our ‘civilization’. Every thing in nature grows, and then stops growing. We’ve created a civilization in which that basic physical rule does not apply and we are reaping the consequences: ever rapid resource depletion and contamination, mass extinctions, environmental destruction and contamination, drought, starvation, overcrowding, homelessness, poverty… All because a few hundred Oligarchs want ever ‘more’.  And have conditioned us to believe that we want ever ‘more’ even though the vast majority of us never will attain Oligarchical levels of it. That simple and insidious idea; ‘more’ has led us to the brink of collapse on multiple levels, yet we’re still being told that everything is ok. Why? We need Barefoot Economics. NOW.”

Related Story:

AT&T To Buy T-Mobile: Great For Them, Bad For You

What Does Proposed AT&T And T-Mobile Merger Mean?

By Ethan Smith @ The Wall Street Journal:

The government’s decision to block AT&T Inc.’s T -0.76% takeover of Deutsche Telekom AG’s DTEGY -0.18% T-Mobile USA unit will result in higher prices to consumers, AT&T Chairman and Chief Executive Randall Stephenson contended during a public interview Wednesday.

Speaking at the Milken Institute’s annual global conference, Mr. Stephenson said that the U.S. wireless-telecommunications market can’t sustain the current number of competitors because there isn’t enough wireless spectrum for all of them.

Based on current patterns, wireless data usage will increase 75% a year for at least five years, Mr. Stephenson said.

“We’re running out of the airwaves that this traffic rides on,” he added. “There is a shortage of this spectrum.”

With or without a deal like the one his company unsuccessfully pursued, he said, competitors will be forced to drop out if they can’t find enough wireless capacity to offer more modern data services to growing numbers of customers.

“The more competitors you have, the less efficient the allocation of spectrum will be,” he said. “It’s got to change. I don’t think the market’s going to accommodate the number of competitors there are in the landscape.”

Many countries in Asia, Europe and Latin America have many fewer companies offering wireless voice and data services, letting them allocate bandwidth more efficiently, Mr. Stephenson contended.

“Since that deal got killed, our data prices have gone up 30%,” he said. He also blamed the blocked T-Mobile USA deal, in part, for AT&T’s decision earlier this year to impose a limit on the amount of data available to a given customer. However, he said such a move probably would have been necessary regardless of the decision, and that he regretted not imposing the cap sooner.

“I wish we had moved quicker to change the pricing model to make sure the people who were using the bandwidth were paying for the bandwidth,” Mr. Stephenson said.

Apple’s iPhone Keeps A Secret Record Of Everywhere You Go, Your Permission Is Not Required

In Uncategorized on April 20, 2011 at 6:02 pm

20th Century Telescreen

Oldspeak: ” ‘Big Brother is watching you’ -George Orwell. As the surveillance state continues to expand under the guise of “convenience” and “personalization” your privacy is invaded and your rights are contracted. Contemplation complete, I’m officially trashing my iPhone. You should too. Your personal “Telescreen” is recording your movements 24-7, sans your permission. It’s not accidental, and it’s not being transmitted to Apple. And there’s nothing you can do about it. Except stop using it.  ‘Apple declined to comment on why the file is created or whether it can be disabled’. Why? Who is this information shared with? Where could it be transmitted? Why is this information not disclosed to users?!”

By Charles Arthur @ The U.K. Guardian:

21st. Century Telescreen. Apple’s iPhone saves every detail of your movements to a file on the device.

Security researchers have discovered that Apple‘s iPhone keeps track of where you go – and saves every detail of it to a secret file on the device which is then copied to the owner’s computer when the two are synchronised.

The file contains the latitude and longitude of the phone’s recorded coordinates along with a timestamp, meaning that anyone who stole the phone or the computer could discover details about the owner’s movements using a simple program.

For some phones, there could be almost a year’s worth of data stored, as the recording of data seems to have started with Apple’s iOS 4 update to the phone’s operating system, released in June 2010.

“Apple has made it possible for almost anybody – a jealous spouse, a private detective – with access to your phone or computer to get detailed information about where you’ve been,” said Pete Warden, one of the researchers.

Only the iPhone records the user’s location in this way, say Warden and Alasdair Allan, the data scientists who discovered the file and are presenting their findings at the Where 2.0 conference in San Francisco on Wednesday. “Alasdair has looked for similar tracking code in [Google's] Android phones and couldn’t find any,” said Warden. “We haven’t come across any instances of other phone manufacturers doing this.”

Simon Davies, director of the pressure group Privacy International, said: “This is a worrying discovery. Location is one of the most sensitive elements in anyone’s life – just think where people go in the evening. The existence of that data creates a real threat to privacy. The absence of notice to users or any control option can only stem from an ignorance about privacy at the design stage.”

Warden and Allan point out that the file is moved onto new devices when an old one is replaced: “Apple might have new features in mind that require a history of your location, but that’s our specualtion. The fact that [the file] is transferred across [to a new iPhone or iPad] when you migrate is evidence that the data-gathering isn’t accidental.” But they said it does not seem to be transmitted to Apple itself.

Map shows location data collected from an iPhone that had been used in the southwest of England

Although mobile networks already record phones’ locations, it is only available to the police and other recognised organisations following a court order under the Regulation of Investigatory Power Act. Standard phones do not record location data.

MPs in 2009 criticised the search engine giant Google for its “Latitude” system, which allowed people to enable their mobile to give out details of their location to trusted contacts. At the time MPs said that Latitude “could substantially endanger user privacy”, but Google pointed out that users had to specifically choose to make their data available.

The iPhone system, by contrast, appears to record the data whether or not the user agrees. Apple declined to comment on why the file is created or whether it can be disabled.

Warden and Allan have set up a web page which answers questions about the file, and created a simple downloadable application to let Apple users check for themselves what location data the phone is retaining. The Guardian has confirmed that 3G-enabled devices including the iPad also retain the data and copy it to the owner’s computer.

If someone were to steal an iPhone and “jailbreak” it, giving them direct access to the files it contains, they could extract the location database directly. Alternatively, anyone with direct access to a user’s computer could run the application and see a visualisation of their movements. Encrypting data on the computer is one way to protect against it, though that still leaves the file on the phone.

Graham Cluley, senior technology consultant at the security company Sophos, said: “If the data isn’t required for anything, then it shouldn’t store the location. And it doesn’t need to keep an archive on your machine of where you’ve been.” He suggested that Apple might be hoping that it would yield data for future mobile advertising targeted by location, although he added: “I tend to subscribe to cockup rather than conspiracy on things like this – I don’t think Apple is really trying to monitor where users are.”

The data inside the file containing the location and time information. This is used to plot the map above

The location file came to light when Warden and Allan were looking for a source of mobile data. “We’d been discussing doing a visualisation of mobile data, and while Alasdair was researching into what was available, he discovered this file. At first we weren’t sure how much data was there, but after we dug further and visualised the extracted data, it became clear that there was a scary amount of detail on our movements,” Warden said.

They have blogged about their discovery at O’Reilly’s Radar site, noting that “why this data is stored and how Apple intends to use it — or not — are important questions that need to be explored.”

The pair of data scientists have collaborated on a number of data visualisations, including a map of radiation levels in Japan for The Guardian. They are developing a Data Science Toolkit for dealing with location data.

Davies said that the discovery of the file indicated that Apple had failed to take users’ privacy seriously.

Apple can legitimately claim that it has permission to collect the data: near the end of the 15,200-word terms and conditions for its iTunes program, used to synchronise with iPhones, iPods and iPads, is an 86-word paragraph about “location-based services”.

It says that “Apple and our partners and licensees may collect, use, and share precise location data, including the real-time geographic location of your Apple computer or device. This location data is collected anonymously in a form that does not personally identify you and is used by Apple and our partners and licensees to provide and improve location-based products and services. For example, we may share geographic location with application providers when you opt in to their location services.”

Privacy invasions via technology

April 2011: iPhone location

British researchers on Wednesday revealed that iPhones (and 3G-enabled iPads) keep track of where you go, including timestamps, on a file that is backed up on your computer and shifted onto any new iPhone or iPad you get. Apple hasn’t said why the file is created or whether the tracking can be prevented.

October 2010: US Transportation Security Agency’s X-ray scanners

The “porno scanners” (as they quickly became known) offered a clothes-free vision of people passing through the backscatter machines (whose level of X-ray exposure was also questioned). People who objected to going through those were obliged to go through remarkably intimate examinations – none of which endeared the TSA to air travellers.

April 2010: Google captures Wi-Fi data

In a series of increasingly embarrassed blogposts over the course of April, May and June, Google admitted that while its cars were driving around to capture its (already slightly controversial) Street View pictures of locations around the world, it had also captured Wi-Fi network names – and data from the open ones, potentially including passwords and usernames. The dispute over whether Google should delete the data, and whether it had broken the law in various countries, rumbled on for months.

December 2009: Eric Schmidt

In a speech, Google’s then-chief executive Eric Schmidt suggested that: “If you have something that you don’t want anyone to know, maybe you shouldn’t be doing it in the first place. If you really need that kind of privacy, the reality is that search engines – including Google – do retain this information for some time and it’s important, for example, that we are all subject in the United States to the Patriot Act and it is possible that all that information could be made available to the authorities.”

His words provoked an outcry from privacy rights campaigners, who pointed out that privacy is a right, and that it protects every citizen from abuses by those in power.

What Does Proposed AT&T And T-Mobile Merger Mean?

In Uncategorized on March 23, 2011 at 1:21 pm

Oldspeak:“Corporate consolidation yields reduced choice, anti-democratic monopolistic practices, higher rates, worker elimination/job loss & price gouging. In an industry “regulated” by an agency (FCC)  it has captured, one has to wonder how closely this proposed deal will be scrutinized. If the recent ComcastNBC merger provides any indication, the answer appears to be not very closely atal. :-|”

By Eric K. Arnold @ The Media Consortium:

Welcome to the Wavelength, your bi-weekly field guide to the world of media policy. Over the next four months, we’ll be compiling great content, connecting the dots, building context, and reporting how media policy impacts the lives of everyday people. From the ongoing battle over Net Neutrality to the wild world of Internet regulation, from partisan crusades to media accountability, the Wavelength is here to keep you in the know.

This week, we’re focusing on major mergers, holding telecom giants accountable, and the revolving door at the Federal Communications Commission (FCC).

So, without further ado, let’s take a spin through the media zone.

AT&T to Absorb T-Mobile?

On Sunday, AT&T announced it had reached an agreement with T-Mobile to buy the mobile phone service provider for $39 billion. As reported in the New York Times,  the deal would “create the largest wireless carrier in the nation and promised to reshape the industry.”

The immediate upshot is that the number of nationwide wireless carriers would drop from four to three, with Sprint Nextel running a distant third behind AT&T/T-Mobile and Verizon. Another impact could be higher rates for current T-Mobile customers. Advocates of the deal suggest it could improve AT&T’s oft-criticized service, resulting in fewer dropped calls. However, critics note that the roughly $3 billion in projected annual cost savings will likely come at the expense of workers at the hundreds of retail outlets expected to close, if the deal goes through.

Both the Justice Department and the FCC have to sign off on the merger before it can be approved, a process that could take up to a year.

House adds insult to NPR’s injury

On St. Patrick’s Day, the Republican-controlled House voted 228-192 to end federal funding for NPR. The move came on the heels of a secretly recorded video from conservative activist James O’Keefe that purportedly showed NPR fundraiser Ronald Schiller expressing support for Islamic fundamentalism and disavowing the Tea Party as “racist” — leading Schiller and NPR CEO Vivian Schiller (no relation) to resign. The video was later revealed to be excerpted and heavily edited from a longer video which places Schiller’s remarks in context.

At TAPPED, Lindsay Beyerstein watched the entire two hour video, and notes that:

O’Keefe’s provocateurs didn’t get what they were looking for. They were ostensibly offering $5 million to NPR. Their goal is clearly to get Schiller and his colleague Betsy Liley to agree to slant coverage for cash. Again and again, they refuse, saying that NPR just wants to report the facts and be a nonpartisan voice of reason.

As reported in the Washington Times, the Democratic-controlled Senate is unlikely to pass the bill, making NPR’s federal funding safe—for now. However, the timing of the vote suggests that House Republicans are essentially endorsing O’Keefe’s questionable tactics, showing that their dislike of the so-called liberal media is of greater concern.

Telecoms add ramming to their list of illegal practices

A recent AlterNet story by David Rosen and Bruce Kushnick details sneaky, unethical, and possibly illegal telecom tactics, the most recent of which is “ramming.”

“Ramming” happens “when a phone company‘s customer is put on a service plan or package s/he did not need or want or cannot even use.” According to the article, “An estimated 80 percent of phone company customers have been overcharged or are on plans they did not need or even order. These and other scams can cost residential customers $20 or more a month extra and small business customers up to thousands of dollars a month.”

These practices are insidious because modern telephone bills are so cryptic that it’s not easy for even the most astute customer to figure out they’ve been duped.

Powell’s next move

Last Tuesday, former FCC chair Michael Powell announced that he has taken over as president of the National Cable and Telecommunications Association. Leading media advocacy organization Free Press snarkily congratulated Powell via a statement from Managing Director Craig Aaron:

If you wonder why common sense, public interest policies never see the light of day in Washington, look no further than the furiously spinning revolving door between industry and the FCC.

Former Chairman Michael Powell is the natural choice to lead the nation’s most powerful cable lobby, having looked out for the interests of companies like Comcast and Time Warner during his tenure at the Commission and having already served as a figurehead for the industry front group Broadband for America.

AT&T imposes monthly usage caps

Finally, we’ve got more bad news for those unlucky enough to have AT&T as their Internet and cable service provider. As Truthout’s Nadia Prupis recently reported, AT&T customers who use the company’s U-Verse cable TV service and DSL hi-speed Internet services in the United States can expect a bump in their monthly bills if they exceed a new usage cap – 50GB for DSL customers and 250 GB for U-Verse users. Those who exceed the storage fee will be charged $10 extra for every 50GB over the limit.

Surprisingly, the telecom behemoth continues to insist their price-gouging moves are in the consumer’s best interests. According to an AT&T press release: “Our new plan addresses another concern: customers strongly believe that only those who use the most bandwidth should pay more than those who don’t use as much.”

Personally, I don’t spend too much time thinking about how much bandwidth other people are using, as long as I’m getting the download speeds I’m paying for.

This post features links to the best independent, progressive reporting about media policy and media-related matters by members of The Media Consortium. It is free to reprint and repost. To read more of The Wavelength, click here. For the best progressive reporting on critical economy, environment, health care and immigration issues, check out The AuditThe MulchThe Pulse and The Diaspora. This is a project of The Media Consortium, a network of leading independent media outlets, and is produced with the support of the Media Democracy Fund.

AT&T To Buy T-Mobile: Great For Them, Bad For You

In Uncategorized on March 20, 2011 at 10:34 pm

Oldspeak:“Corporate consolidation continues its march on a path of destruction of choice and flouting of anti-trust laws. “Less competition always results in higher prices” -Sascha Segan. Coming soon, from AT&T/T-Mobile, higher prices, poorer service…. I might have to switch to CREDO MOBILE.  B & L soon come:”

By Sascha Segan @ PC Magazine:

AT&T just announced it will buy T-Mobile USA for $39 billion. If the transaction gets approved by the government and closes in a year as planned, it will create the nation’s largest wireless carrier by far.

While this is great news for both companies, it’s an awful idea for consumers – and I desperately hope the US antitrust authorities rake this merger over the coals.

An AT&T/T-Mobile merger at least makes more sense than the silly T-Mobile/Sprint idea which was being bandied about. Both carriers use the same technologies: GSM, HSPA+ and LTE. While they’re on different frequency bands, radios which use all of the relevant bands are becoming easier to build.

The merger neatly solves T-Mobile’s long-term problem of not having enough spectrum for LTE, the 4G technology which will soon be a global standard. It gives T-Mobile’s struggling parent, Deutsche Telekom, a gigantic cash infusion. And it lets AT&T once again position itself as the number-one carrier against Verizon Wireless, which leapfrogged AT&T technologically this year with Verizon’s 4G LTE launch.

AT&T is ahead of T-Mobile on building LTE. T-Mobile is far ahead of AT&T on building HSPA+, a intermediate 4G technology that fits right between the carriers’ existing 3G networks and LTE. Together, they could have a smooth and powerful nationwide network.

AT&T’s press release for the merger backs this up. The combined carrier will be able to build out much more LTE Than AT&T could alone, by combining AT&T’s 700 Mhz spectrum with T-Mobile’s AWS spectrum.

For stockholders, this all sounds great. With reduced competition and the efficiencies of a combined network, the new company will probably be quite profitable.

For phone owners, tech lovers, and American consumers, this is a total disaster.

Rates Will Rise, Customer Service Will Drop

Let’s start with a basic fact: less competition always results in higher prices than you would have had otherwise. T-Mobile has always been a value leader, offering low prices and some innovative plans, such as its Even More Plus plans which gave monthly discounts in exchange for paying the full up-front price for phones. These plans will go away and the combined carrier will normalize at AT&T’s higher rates.

In AT&T’s press release for the merger, the company doesn’t bother to rebut this idea. Rather, the carrier says there’s already plenty of competition and implies that prices are so low that Americans shouldn’t be too concerned. AT&T also shows a disingenuous chart explaining that prices dropped when carriers merged over the past ten years. Of course, it doesn’t show what would have happened to prices if those carriers hadn’t merged.

This merger also means less phone choice for US consumers. Unlike in most other countries, the American phone market is dominated by the carriers; the carriers have to approve and sell most phones. The process of making it through approval labs, and the space on carrier store shelves, limit the number of phones each carrier can handle at once. I’m pretty sure that the number of phones carried by AT&T/T-Mobile will be less than the current number carried by the two carriers separately, because they will want to create efficiencies and unify their product lines.

This doesn’t mean T-Mobile’s phones will go away – I see the merged carrier cherry picking an iPhone here, a MyTouch 4G there. But it means that there will be fewer choices overall for American consumers, and fewer chances for new manufacturers or ideas to appear in the marketplace.

From a customer service perspective, make no mistake, AT&T will subsume T-Mobile. The merged carrier will not have T-Mobile’s friendliness, nimbleness, or level of customer service. Just like in the horrifying Sprint-Nextel mess or during the long, slow, grinding AT&T/Cingular merger, the merged carrier will sink to the minimum customer service level of its parts.

I’ve sung this song before. I don’t see how the biggest carriers getting bigger improves anything for consumers. We’ve seen many times around the world how duopolies or cozy tri-opolies can retard innovation and drag up prices (hello, Canadians!) and the US government should do everything in its power to prevent the US wireless market from becoming wholly owned by AT&T and Verizon Wireless.

Short of killing this merger entirely, I’m not sure what the government could do to maintain competition here. AT&T and T-Mobile are the only major GSM carriers; everybody else is CDMA. That means if the government forced the merged carrier to divest some markets to be picked up by someone else, the buyer of the divested markets won’t be able to integrate them easily into its existing network.

If this merger goes through, it only becomes more urgent for MetroPCS, Cricket and US Cellular to band together into a new, single low-cost force in the wireless market. Together, the three carriers would have around 20-21 million users. They all use the same CDMA technology, and their spectrum holdings largely don’t overlap. A new nationwide value leader could help reduce the negative effects of this merger for US consumers.

AT&T-T-Mobile USA deal may face regulatory hurdles

Oldspeak:”But it might not be a done deal just yet, maybe regulators will actually regulate this industry. ‘The biggest issue for the FCC and for the Department of Justice, which also needs to approve this merger, is whether a merger between these companies would concentrate too much power in the hands of a single company, which could affect pricing and services for consumers.’ -Marguerite Reardon’ Heres hoping the FCC and DOJ don’t roll over on this one too.”

By Marguerite Reardon @ CNET:

From a network and technology perspective, the $39 billion marriage between AT&T and T-Mobile USA is a no-brainer, but the companies may have to do some smooth talking to get the deal approved by regulators.

AT&T and T-Mobile USA, which is owned by German phone company Deutsche Telekom, each use the GSM technology and each company plans to deploy the 4G technology known as LTE in the future. AT&T plans to launch its LTE network this summer, and T-Mobile has said in the past that LTE is on its roadmap.

Currently, each company has been upgrading its network to the latest version of 3G wireless technology called HSPA+. (T-Mobile stirred up controversy last summer when it began marketing the HSPA+ network as 4G. AT&T, which initially criticized T-Mobile for this, began calling its own HSPA+ network 4G earlier this year.)

The technology synergies between T-Mobile and AT&T are stark contrast to how T-Mobile lined up with Sprint Nextel, which had been rumored to be eying T-Mobile for more than two years. Sprint uses a different network technology called CDMA, which is the same technology that Verizon Wireless uses. What’s more Sprint is using WiMax for its next generation wireless network.

While regulators would have been much more eager to see No. 3 Sprint Nextel merge with No. 4 T-Mobile so that they could take on No. 1 Verizon Wireless and No. 2 AT&T, the reality is that such a scenario would have been an integration nightmare for Sprint. Sprint is still struggling to make sense of its 2005 acquisition of Nextel, which also used a completely different technology.

“There’s no question that AT&T and T-Mobile are a very good fit from a technology standpoint,” said Charles Golvin, an analyst with Forrester Research. “A Sprint-T-Mobile deal would have given these companies scale, but it made sense from an integration standpoint.”

But even though the deal makes sense from a technology standpoint, it won’t necessarily be smooth sailing. For one, regulators are likely to scrutinize this deal closely. And secondly, even though AT&T and T-Mobile use the same technology, they use different wireless spectrum bands to deliver their services. This means that AT&T will have to move T-Mobile’s customers to different spectrum bands in order to integrate the networks.

Regulatory scrutiny
First let’s look at the regulatory picture. The biggest issue for the FCC and for the Department of Justice, which also needs to approve this merger, is whether a merger between these companies would concentrate too much power in the hands of a single company, which could affect pricing and services for consumers. T-Mobile has always been a price leader. It’s safe to say that AT&T will likely not adopt T-Mobile pricing, which means that consumers will be losing a more affordable player in the wireless market.

And the reason is simple. It won’t need to. AT&T and Verizon Wireless already control more than 40 percent of the existing wireless market. And T-Mobile, the smallest of the major wireless operators, would concentrate AT&T’s market power further. A combined AT&T and T-Mobile would have nearly 130 million subscribers, which is a third more than Verizon Wireless, the No. 1 nationwide player in the country. The new AT&T-T-Mobile would also have twice as many customers as No. 3. Sprint Nextel.

The FCC has already expressed concern over the competitive landscape in wireless. In May the FCC warned that the industry is getting too concentrated. In its report, the agency said that since 2003, market concentration in wireless has increased 32 percent. The report indicates that 60 percent of the nation’s subscribers and revenue come from the country’s two largest wireless providers: AT&T and Verizon Wireless. The FCC noted that these companies are continuing to gain customers as other national operators, Sprint Nextel and T-Mobile USA, have been losing subscribers.

So far the FCC hasn’t issued a statement regarding the proposed AT&T-T-Mobile merger. But insiders at the agency have said previously that they would be more concerned with an acquisition between AT&T and Verizon Wireless and either Sprint Nextel or T-Mobile USA than a merger involving Sprint Nextel and T-Mobile.

AT&T and Verizon Wireless have scoffed at the FCC’s assertion that the wireless industry is not competitive. And the companies have repeatedly pointed to the fact that there are often four to five players in almost every major market in the U.S. Smaller players such as MetroPCS and Leap Wireless have aggressively moved into new markets. And U.S. Cellular, a regional wireless carrier, has gotten high marks in terms of customer satisfaction in many national surveys.

But the fact remains that AT&T and Verizon Wireless have far more customers than any of these smaller players. Indeed, Golvin estimates that a combined AT&T and T-Mobile would mean that three out of four wireless subscribers in the U.S. would be a customer of either AT&T or Verizon Wireless.

What’s more, combining AT&T and T-Mobile, means that there would be only one national wireless carrier using the GSM technology. Verizon and Sprint Nextel use CDMA, as mentioned above. This would give consumers, who want to use their phones overseas in places such as Europe, only one choice in national U.S. carrier.

At least one congressional leader is already pushing the FCC and Department of Justice to take a hard look at this deal.

“With every passing day, wireless services are becoming more and more important to the way we communicate,” John D. Rockefeller IV (D-West Virginia), chairman of the Senate’s Commerce Science and Transportation committee, said in a statement. “So it is absolutely essential that both the Department of Justice and the FCC leave no stone unturned in determining what the impact of this combination is on the American people.”

While it is possible that the FCC and/or the Justice Department could simply stop the merger from happening, it’s unlikely they’d do that, Golvin said. Instead, it’s more likely that these agencies would put conditions on the merger and require AT&T to divest some of its wireless spectrum assets, he added.

“I don’t believe this will have a ‘yes’ or ‘no’ outcome,” Golvin said. “I think what the regulators do will be more about the extent of AT&T’s divestiture.”

In fact, the FCC took this approach when it approved Verizon’s $28.1 billion merger of regional carrier Alltel Wireless, which closed in January 2009. Instead of analyzing this merger on a national basis, the FCC analyzed each individual market where Verizon and Alltel operated. And in markets where there was too much concentration, the FCC required that the Verizon sell those wireless assets. All told, Verizon agreed to sell operations in 105 markets where Alltel also operated.

AT&T CEO Randall Stephenson spoke to the Wall Street Journal on Sunday and said that he is confident that the company will get regulatory approval. He said that the merger will help “conserve spectrum at a time when that resource is in tight supply.”

He also said that the wireless market is already very competitive.

“This is probably the most fiercely competitive wireless market in the world,” he was quoted as saying. “The majority of Americans have the option of five different wireless carriers.”

Spectrum issues
Regulatory issues may be only one hurdle the companies face as they look at integrating the two wireless networks. While it’s true that T-Mobile and AT&T each use GSM technology, the carriers also use different bands of spectrum to deliver their services. Specifically, T-Mobile uses the spectrum it bought in the AWS spectrum auction in 2006 to build its 3G wireless network.

AT&T also acquired spectrum in that auction. And it is using this AWS spectrum to build its LTE network. AT&T uses its 850MHz and 1900MHz spectrum to deliver its 3G service. Part of the reason that AT&T wanted T-Mobile in the first place was to get more of the AWS spectrum for its LTE network.

Meanwhile, T-Mobile has no additional spectrum to deploy LTE, since it’s been using the AWS spectrum for its 3G service. What this means is that once AT&T and T-Mobile merge, AT&T will have to move all of T-Mobile’s existing 3G customers (which includes the supposed 4G HSPA+ customers) to AT&T’s 850MHz and 1900MHz spectrum. This means T-Mobile customers will need new handsets, since the existing T-Mobile 3G HSPA and 4G HSPA+ handsets will no longer work on the AWS spectrum.

The migration of additional T-Mobile customers to AT&T’s already congested 3G network could also be painful for existing AT&T customers. But Golvin believes that in the long run, AT&T will actually benefit from the merger with T-Mobile because it will allow AT&T to use the newly upgraded backhaul systems that T-Mobile has put in place to link its radio network to the hard-wired Internet and telephone backbone.

“For some period of time, customers from either network may find that the quality is not what they would like,” Golvin said. “But AT&T won’t be able to just turn off the T-Mobile network. It will take time and it will be done in stages. I think what might be more painful for some T-Mobile customers is that they were T-Mobile customers because they didn’t want to be AT&T customers.”

The deal comes just days before the wireless industry meets in Orlando, Fla., for the CTIA’s spring trade show and conference. On Tuesday morning, CEOs from all four major U.S. wireless carriers–AT&T, Verizon Wireless, Sprint Nextel, and T-Mobile–will take the stage for a roundtable discussion. FCC Chairman Julius Genachowski is also expected to give a speech Tuesday morning from CTIA. It’s unclear how much if anything the players involved in the merger will say at CTIA. But CNET will be there, so stay tuned.

 

 


 

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