AT&T files the paperwork for its proposed acquisition of T-Mobile

Alex Wagner
Editorial Director of News and Content from Omaha, NE
Published: April 21, 2011

AT&T-Mobile

Last week we learned that AT&T and T-Mobile would begin filing the paperwork necessary to to get their merger approved sometime around the 21st, and today that's exactly what happened. ATT just announced that they've handed the initial bit of paperwork over to the FCC today, which includes a public interest statement on all of the benefits that the deal, if approved, will bring. According to the document, AT&T believes it will be able to deploy LTE coverage to 97.3 percent of Americans if the deal is approved, up from its previous estimate of 95 percent, and that the merger will help to reduce the number of dropped calls and improve data speeds and in-building coverage. The company also believes that a combined AT&T-Mobile would help to create jobs and spur economic growth in rural areas of the country.

There have been a number of entities that have voiced their concerns about AT&T's acquisition of T-Mobile over the past month, most notably Sprint, which believes that the deal would turn the wireless industry into a duopoly which would stifle growth and innovation. Whether or not ATT's latest arguments will do anything to sway the deal's detractors is tough to say, but it's obvious that the merger has a long road ahead of it, and I'm sure we'll be hearing a lot more from both sides soon.

AT&T Files Public Interest Statement with FCC on T-Mobile Acquisition

DALLAS--(BUSINESS WIRE)--AT&T Inc. (NYSE: T) today filed with the Federal Communications Commission its Public Interest Statement regarding its proposed acquisition of T-Mobile USA. The filing demonstrates the numerous benefits of the merger, including the deployment of 4G LTE network technology to more than 97 percent of the population. When the parties announced this transaction in March 2011, AT&T initially stated that it would deploy LTE to 95 percent of the U.S. population. After conducting a more refined analysis of the combined network, AT&T is increasing the scope of this commitment to 97.3 percent. This deployment will help fulfill this Administration’s pledge to connect every part of America to the digital age, and it will create new jobs and economic growth in the small towns and rural communities that need them most.

The publicly available filing, with certain portions containing competitively confidential information redacted, is available at www.MobilizeEverything.com.

Additional highlights of the filing include:

AT&T has helped make the United States the global leader in mobile broadband and smartphone sales. AT&T’s mobile broadband leadership, however, presents it with unique spectrum and capacity challenges. A smartphone generates 24 times the mobile data traffic of a conventional wireless phone, and the explosively popular iPad and similar tablet devices can generate traffic comparable to or even greater than a smartphone. AT&T’s mobile data volumes surged by a staggering 8,000% from 2007 to 2010, and as a result, AT&T faces network capacity constraints more severe than those of any other wireless provider.

AT&T is using up its spectrum at an accelerating rate, and the wireless broadband revolution is just beginning. Over the next five years, data usage on AT&T’s network is projected to skyrocket as customers “mobilize” all of their communications activities, from streaming HD video and cloud computing to a range of M2M applications like energy management, fleet tracking, and remote health monitoring. In just the first five-to-seven weeks of 2015, AT&T expects to carry all of the mobile traffic volume it carried during 2010.

This merger provides by far the surest, fastest and most efficient solution to that challenge. The network synergies of this transaction will free up new capacity - the functional equivalent of new spectrum - in the many urban, suburban and rural wireless markets where escalating broadband usage is fast consuming existing capacity.

This transaction will thus benefit consumers by reducing the number of dropped and blocked calls, increasing data speeds, improving in-building coverage, and dramatically expanding deployment of next-generation mobile technology.

The transaction’s benefits arise from the uniquely complementary nature of AT&T and T-Mobile’s GSM/HSPA+ technologies and spectrum holdings.

The combined company expects to integrate a significant portion of T-Mobile cell sites into the AT&T network. Upon network integration, which will benefit customers in as little as nine months, this will equate to “instant” cell splits - increasing cell density and effectively doubling the amount of network traffic that can be carried using existing spectrum in the areas served by those cell sites.

Groups across the political spectrum, including a broad range of consumer, disability, civil rights, and rural advocacy groups have highlighted the transaction’s potential to empower consumers, workers and small businesses to participate more fully in our nation’s broadband society.

The U.S. wireless marketplace is fiercely competitive, characterized by escalating usage, product differentiation, rapid innovation, fierce advertising campaigns, new entry, and sharply declining prices for wireless service by unit of consumption (e.g., minutes or megabytes). In fact, the FCC found last year that approximately three-quarters of Americans live in localities contested by at least five facilities-based wireless providers.1 These other competitors are rapidly growing and investing and will ensure the wireless marketplace remains vibrantly competitive after the transaction.

About AT&T

AT&T Inc. (NYSE:T) is a premier communications holding company. Its subsidiaries and affiliates – AT&T operating companies – are the providers of AT&T services in the United States and around the world. With a powerful array of network resources that includes the nation’s fastest mobile broadband network, AT&T is a leading provider of wireless, Wi-Fi, high speed Internet, voice and cloud-based services. A leader in mobile broadband and emerging 4G capabilities, AT&T also offers the best wireless coverage worldwide of any U.S. carrier, offering the most wireless phones that work in the most countries. It also offers advanced TV services under the AT&T U-verse® and AT&T ¦DIRECTV brands. The company’s suite of IP-based business communications services is one of the most advanced in the world. In domestic markets, AT&T Advertising Solutions and AT&T Interactive are known for their leadership in local search and advertising.

Additional information about AT&T Inc. and the products and services provided by AT&T subsidiaries and affiliates is available at http://www.att.com. This AT&T news release and other announcements are available at http://www.att.com/newsroom and as part of an RSS feed at www.att.com/RSS. Or follow our news at @ATT.

Cautionary Language Concerning Forward-Looking Statements

Information set forth in this press release contains financial estimates and other forward-looking statements that are subject to risks and uncertainties, and actual results might differ materially. A discussion of factors that may affect future results is contained in AT&T's filings with the Securities and Exchange Commission. AT&T disclaims any obligation to update and revise statements contained in this news release based on new information or otherwise.

© 2011 AT&T Intellectual Property. All rights reserved. Mobile broadband not available in all areas. AT&T, the AT&T logo and all other marks contained herein are trademarks of AT&T Intellectual Property and/or AT&T affiliated companies. All other marks contained herein are the property of their respective owners.

1 Fourteenth Report, Implementation of Section 6002(b) of the Omnibus Budget Reconciliation Act of 1993, 25 FCC Rcd 11407, 11621-22 ¶¶ 42-45 (May 20, 2010) (“Fourteenth Wireless Report”).