Monday, March 21, 2011

AT&T plans to acquire T-Mobile, improve cell coverage

It's been a bit of a long running (if sometimes flawed) joke in the cell business that AT&T Wireless service is the pits.

That joke could be getting really old fast now that AT&T has officially announced plans to acquire T-Mobile USA in a $39 billion cash and stock deal. The agreement, which needs federal approval, was OK'd by both companies board of directors.

The acquisition should be complete within 12 months and make the combined company the nation's largest wireless group. AT&T currently has about 96 million subscribers and T-Mobile nearly 34 million. The combined company would capture 42 percent of all U.S. wireless subscribers. Verizon has 31 percent, according to industry analysts.

AT&T says the potential merger would allow it to bring true 4G (LTE) mobile broadband speeds to 95 percent of the U.S. population, reaching 46.5 million more Americans than AT&T's current plan will allow for. Current T-Mobile subscribers will get access to the true LTE 4G network when it's deployed. T-Mobile currently advertises its network as 4G, but it's really more of a 3.5 G network, operating on current 3G technology, technically called HSPA+.

AT&T -- which could be on the hook for a $3 billion breakup fee to T-Mobile if the deal doesn't go through -- said the new spectrum it gains will help improve signal strength and voice quality in existing markets and help it grow. It says its mobile data grew 8,000 percent over the past four years. In four years, AT&T said it will take six or seven weeks to reach the amount of data its networks carried in all of last year.

What will this mean for the consumer? Hopefully better cell coverage via the new AT&T, hopefully super fast and reliable 4G speeds, but hopefully not at significantly higher costs. T-Mobile's forum page about the changes is already lighting up.

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