Feeds

Cingular eyes AT&T Wireless for mobile mega merger

But good for who, exactly?

  • alert
  • submit to reddit

Top three mobile application threats

Cingular looks set to beat T-Mobile to merge with AT&T Wireless, according to the Wall Street Journal, which reports that the two are in an advanced stage of negotiations. The merged company would become the No.1 mobile phone network in the US, with 45 million subscribers, pushing Verizon out of the top spot.

AT&T, T-Mobile and Cingular all compete using GSM/GPRS networks; Sprint and Verizon operate CDMA.

When the Deutsche Telecom-owned T-Mobile entered the US eighteen months ago, it looked a natural partner to merge with Cingular, the joint venture between the SBC Baby Bells (California, Nevada) and BellSouth. In some regions, such as here in the Bay Area, the two share the same network infrastructure. However talks between AT&TW, which spun off from the Death Star in the summer of 2001, and Deutsche Telecom never gained any momentum. Both T-Mobile and AT&T Wireless have considerable debt burdens.

AT&TW and Cingular already have a joint venture to build out infrastructure on major highways, worth some $50 million according to a Cingular SEC filing.

Some creativity will be required from the accountants. A potential suitor for AT&T would have to meet a $23 billion evaluation, and SBC and Bell South have around $10 billion in ready cash. But would the acquisition benefit long-suffering consumers?

If the savings were passed on to the customers in the form of better plans or better infrastructure (Cingular/T-Mobile's service here is notorious, even by US standards), then obviously, yes. However GSM phone users who have a choice of three providers here, would see their options diminish fairly dramatically. The merged company would also need to devote its energies to internal organizational issues (such as sacking tens of thousands of staff) rather than planning a coherent strategy that encompasses wireline and wireless, as Verizon is doing so impressively.

A clue about who the real losers will be comes from a Reuters wire report, which describes how the merged company will benefit from "consolidating stores" (consolidating being a prudent, even comforting fate for a building) and "slashing staff"; slashing being what Freddy from Friday the Thirteenth does.

That's reassuring. ®

Combat fraud and increase customer satisfaction

More from The Register

next story
Virgin Media so, so SORRY for turning spam fire-hose on its punters
Hundreds of emails flood inboxes thanks to gaffe
A black box for your SUITCASE: Now your lost luggage can phone home – quite literally
Breakfast in London, lunch in NYC, and your clothes in Peru
AT&T threatens to pull out of FCC wireless auctions over purchase limits
Company wants ability to buy more spectrum space in auction
Turnbull leaves Australia's broadband blackspots in the dark
New Statement of Expectations to NBN Co offers get-out clauses for blackspot builds
Facebook claims 100 MEEELLION active users in India
Who needs China when you've got the next billion in your sights?
Facebook splats in-app chat, whacks brats into crack yakety-yak app
Jibber-jabbering addicts turfed out just as Zuck warned
Google looks to LTE and Wi-Fi to help it lube YouTube tubes
Bandwidth hogger needs tube embiggenment if it's to succeed
prev story

Whitepapers

Securing web applications made simple and scalable
In this whitepaper learn how automated security testing can provide a simple and scalable way to protect your web applications.
3 Big data security analytics techniques
Applying these Big Data security analytics techniques can help you make your business safer by detecting attacks early, before significant damage is done.
The benefits of software based PBX
Why you should break free from your proprietary PBX and how to leverage your existing server hardware.
Top three mobile application threats
Learn about three of the top mobile application security threats facing businesses today and recommendations on how to mitigate the risk.
Combat fraud and increase customer satisfaction
Based on their experience using HP ArcSight Enterprise Security Manager for IT security operations, Finansbank moved to HP ArcSight ESM for fraud management.