AT&T has agreed to acquire T-Mobile USA for $39 Billion

AT&T has agreed to acquire T-Mobile USA for $39 Billion

AT&T has agreed to acquire T-Mobile USA from Deutsche Telekom in a cash-and-stock deal valued at approximately $39 billion.

From the press release:

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DALLAS, TEXAS AND BONN, GERMANY — March 20, 2011— AT&T Inc. (NYSE: T) and Deutsche Telekom AG (FWB: DTE) today announced that they have entered into a definitive agreement under which AT&T will acquire T-Mobile USA from Deutsche Telekom in a cash-and-stock transaction currently valued at approximately $39 billion. The agreement has been approved by the Boards of Directors of both companies.

AT&T’s acquisition of T-Mobile USA provides an optimal combination of network assets to add capacity sooner than any alternative, and it provides an opportunity to improve network quality in the near term for both companies’ customers. In addition, it provides a fast, efficient and certain solution to the impending exhaustion of wireless spectrum in some markets, which limits both companies’ ability to meet the ongoing explosive demand for mobile broadband.

With this transaction, AT&T commits to a significant expansion of robust 4G LTE (Long Term Evolution) deployment to 95 percent of the U.S. population to reach an additional 46.5 million Americans beyond current plans – including rural communities and small towns. This helps achieve the Federal Communications Commission (FCC) and President Obama’s goals to connect “every part of America to the digital age.” T-Mobile USA does not have a clear path to delivering LTE.

AT&T operates the largest wireless network in the US, with about 95.5 million subscribers, while T-Mobile runs the fourth largest, with 23 million. Both networks are based on the same GSM technology used in most major markets across the rest of the world, and the merger would leave the US with only one GSM provider.

Full Press release Here (new window)

Verizon, which operates the country’s second largest network, and Sprint, the third largest provider, use the CDMA standard.

In announcing the deal, AT&T said it would allow the company to bring its planned 4G LTE (Long Term Evolution) network to T-Mobile subscribers. “This transaction represents a major commitment to strengthen and expand critical infrastructure for our nation’s future,” AT&T chairman and CEO Randall Stephenson said in a canned statement. “It will improve network quality, and it will bring advanced LTE capabilities to more than 294 million people.”

That’s a theoretical 294 million.

T-Mobile offers HSPA+ technology, a step beyond 4G, but it has yet to commit to a true 4G network along the lines of AT&T’s LTE network. AT&T claimed the deal would answer the call of the Federal Communications Commission (FCC) and President Obama to connect “every part of America to the digital age”.

A cool name for the new company would be AT&T Mobile – thats my vote anyway.

This will be interesting from an Apple Iphone/Windows 8 matchup.

This will be great for Apple as they get to offer the Iphone to a lot more customers and not so great for any Windows Phone 7 or Windows Phone 8 Operating system.

Let’s see if this one gets approved by the regulatory powers that be..

Onuora Amobi is the Founder and VP of Digital Marketing at Learn About The Web Inc. Onuora has more than a decade of information security, project management and management consulting experience. He has specialized in the management and deployment of large scale ERP client/server systems. In addition to being a former Microsoft MVP and the founder and editor of EyeOnWindows.com, he is the CEO of a Pasadena based online marketing education startup - Learn About The Web Inc. (www.learnabouttheweb.com).

  • Sam Mbakwe

    Goodbye Windows Phone, Apple Iphone – Your throne is waiting for you..

  • xinu

    Good news for iPhone customers.

  • Anonymous

    Good news for iPhone customers.