Tuesday, March 22, 2011

AT&T + T-Mobile = ????

Surprise merger proposal involving AT&T and T-Mobile.  T-Mobile had been thought to be in talks with Sprint to create a strong #3 in the US market behind AT&T and Verizon.  Most news accounts (e.g., this one from NYT) focus on the loss of a major competitor and the possibility of higher prices for consumers. 

Another possible scenario: the combined company achieves economies of scale that actually pushes prices down, small carriers in various markets continue to provide low-cost options for those not tethered to iPhones and global competitors ponder entering the US market, creating further competitive pressure.  New network technologies are another competitive threat. 

This deal will definitely get close scrutiny from the antitrust folks. 

No comments:

Post a Comment