AT&T Ends Bid To Acquire T-Mobile

 In Mobile Technology

ATT T-Mobile Merger

Since early 2011, AT&T (NYSE:T) has been bidding to try and acquire T-Mobile USA, in order to merge two of the larger carriers in the United States into one large conglomerate. On Monday, AT&T announced that they are now ending their bid to acquire T-Mobile, after an almost 8 month back and forth between AT&T and federal regulators.

The government got involved after news of the merger which led many to believe that AT&T was gaining too much power and control over the other major carriers, Sprint and Verizon and would limit competition in major cities across America.

The actions by the Federal Communications Commission and the Department of Justice to block this transaction do not change the realities of the U.S. wireless industry. It is one of the most fiercely competitive industries in the world, with a mounting need for more spectrum that has not diminished and must be addressed immediately. The AT&T and T-Mobile USA combination would have offered an interim solution to this spectrum shortage. In the absence of such steps, customers will be harmed and needed investment will be stifled.

Had the merger between AT&T and T-Mobile followed through accordingly, AT&T would have paid $39 billion in cash and stock, however, the company is now paying parent company, Deutsche Telekom $3 billion in cash plus $1 billion in spectrum as a breakup fee for the failed merger.

AT&T acquired Cingular Wireless in 2007, a smaller carrier in the US that originally received the iPhone. However, AT&T still has a number of carriers to choose from for acquisitions, including Metro PCS (nationwide network based in New York City), as well as C-Spire, the fourth carrier to receive the iPhone in the United States.


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