by Tom Young, Partner & Managing Director, Infrastructure Services, TPI
Yesterday AT&T (NYSE:T) announced it had entered into a definitive agreement to acquire T-Mobile USA from Deutsche Telekom (FWB: DTE) in a $39 billion cash-and-stock transaction.
If the deal is approved by regulators, it will create the largest wireless carrier in the U.S., with 130 million subscribers, enabling AT&T to surge ahead of Verizon Wireless, which had about 94 million wireless customers at the end of 2010.
Many of the nuances of this announcement underscore the fact that enterprise clients continue to play second fiddle to consumers in the U.S. mobility space. Granted, joining these two companies will enable some to get nationwide coverage without turning to multiple mobile carriers (due to AT&T’s well-known service issues in markets such as New York), and that will result in higher-volume purchases, fewer contracts to manage, and simpler integration of mobility with the rest of their U.S.-based infrastructure.
AT&T will still need to address enterprise clients’ desire to create a consistent global mobility strategy. While the T-Mobile acquisition improves coverage in the U.S. market, it is not a stepping stone to greater global coverage. Further, we may see slower innovation in the U.S. market as a result of the decrease in competition.
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