AT&T buys T-Mobile for $39 billion, becomes largest US carrier

It turns out that the rumors we've been hearing about a T-Mobile acquisition are in fact true. The main difference between the fact and fiction is that the carrier doing the acquiring is AT&T and not Sprint.

Over the weekend, Deutsche Telekom sold T-Mobile USA to AT&T for $39 billion and a seat on the AT&T board of directors. This acquisition makes AT&T the largest carrier in the US, at least in terms of subscribers. 

From a technological standpoint, this deal makes more sense than a Sprint/T-Mobile merger because both AT&T and T-Mobile operate GSM networks, although on different frequencies. Both carriers have also selected HSPA+ for 4G expansion, and together their small networks could make a dent in Verizon's 4G coverage. 

Sprint, now a distant third in the subscriber battle, is not amused and is attempting to convince regulators to block this deal. They may have a case, too, as this purchase has the potential to cause a duopoly in the wireless space. What they don't have, however, are the deep pockets necessary to put up a strong fight against AT&T. So it seems almost certain that the deal will be approved.

Consumers, especially T-Mobile customers, may not be very happy about this either. T-Mobile has long had a reputation as a "hacker friendly" carrier, offering data-only and cheap "bring your own phone" plans. They were even supportive of those who brought phones from other GSM carriers for use on their network. Also, as the only other GSM carrier in the US, T-Mobile was the only alternative for users who wanted GSM devices and didn't want to use AT&T. These users will now have to settle for using AT&T or getting a world phone from Verizon or Sprint.

AT&T is widely regarded as a restrictive carrier, with little customer support. Even if they are good on paper, the general preception of AT&T is not good. So although this move makes good business sense for AT&T, it has the potential to make a lot of people unhappy. 

Do you think the AT&T/T-Mobile deal will be good or bad for subscribers? 

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