) offered to purchase Deustche Telekom's T-Mobile unit in the
United States for $39 billion last week, but they'll have to
convince a lot of skeptics first.
Many consumers are wary of the tie-up, which will reduce
competition in a U.S. mobile market already characterized by a lack
of choice. The merger will also face scrutiny from the Federal
Communications Commission, according to the
Wall Street Journal
There's no way the chairman's office rubber-stamps this
transaction. It will be a steep climb to say the least," an unnamed
official at the FCC official told the financial paper on Wednesday.
Several aspects complicate the acquisition. For one, AT&T and
T-Mobile both emplo ythe GSM mobile standard, in contrast to the
CDMA protocol employed by Verizon (
) and Sprint (
). The consolidation would bring every major GSM carrier under a
single umbrella, forcing essentially every customer who wants a GSM
phone to sign with the new combined provider.
Together, AT&T and T-Mobile would bring nearly 130 million
subscribers under a single umbrella, making it the largest wireless
service provider in the United States by far. Internet freedom
advocates have already started
tied to net neutrality and the potential prioritizing of data under
new wireless plans.
The FCC "should reconsider its decision to largely exempt wireless
broadband from its net neutrality Order," writes Matthew Lasar for