One bad company buying another: AT&T buys TMobile (Verizon forced this marriage!)

AT&T Wifi Box in Starbucks store in San Mateo

You all know I really despise AT&T, even though I continue paying them thousands of dollars per year for three cell phones. Since getting my Verizon iPhone I haven’t dropped a call and I can actually hear the other party. Steve Gillmor got one on Friday and, wow, what a difference. Not to mention that the world’s toughest dead zone: Devil’s Slide is non-existent for AT&T and TMobile, but works the entire way on Verizon for me.

TMobile is even worse. It doesn’t have enough coverage. My entire neighborhood, which includes some of the houses of the richest VCs, not to mention VPs from Apple, HP, and other places, has NO TMobile Coverage. This isn’t back waters of some flyover state. It’s 13 miles from the tech center of the world (at least until Beijing takes over later this decade).

CNBC just announced AT&T is buying TMobile’s US business for $39 billion. More details flowing in on Google News and even more over on Techmeme. That’s one way to get more bandwidth to try to serve iPhone users better before they all realize Verizon has a better network.

I think this COULD be a good thing, if they fill in some of the numerous dead zones and get us better service. I’m stuck with AT&T because I need to head to Europe every few months and AT&T’s iPhone is better there. Also because in other places AT&T does have better coverage, and its data is faster and also I can use data while talking, which really isn’t that big a deal for ME anymore (since I have two phones, I solved that problem).

Anyway, does one bad company buying another make a good one? I guess we’ll see.

Yes, I know I might get crap for calling these companies bad companies, but I’ve paid AT&T thousands of dollars over the last few years. I’ve earned that right.

Speaking of which, why didn’t they just spend that $39 billion making a better network? Oh, do I love capitalism sometimes.

This is a forced marriage due to Verizon finally getting the iPhone. If that hadn’t happened AT&T would have continued not to worry and continued not to invest in its network. Now that they know lots of people will switch when their contracts are up they needed to do something huge to try to improve the network before everyone wises up.

Comments

  1. I just jumped shipped from AT&T (been a customer since they were SouthwesternBellWireless) to T-Mobile and honestly, I’ve been enjoying it. Sure, I don’t get as good of 3G coverage, but I get it where I need it, and that’s what’s important. I also noticed that with AT&T, my phone (usually an unlocked one) would SHOW full 3G, but when I tried to use the data, it would be EDGE speeds, or worse. With T-Mobile, my phone might show G (as in, GPRS) sometimes, but when it shows 3G, I *get* 3G.

    I’ll be interested to see how this plays out with the FCC. I can’t imagine they’ll let this one go through, honestly. Kinda glad I switched over, though – AT&T has a history of offering decent incentives to switch once they buy another carrier. :)

  2. Robert,

    Everyone doesn’t have horrible T-Mo service in the Bay. I get excellent service where I live in MV besides one corner of my apartment that is in EDGE land. Coverage in the city is decent though I use my phone mostly for data and not calling.

    What makes T-Mo good is that they let you unlock your phone after a ridiculously short amount of time(something like 90 or 180 days). They also don’t hold back Android OS updates or restrict you from installing apps not in Android Market. And best of all, they don’t charge for tethering or data overages. So for someone who is on T-Mobile, the AT&T reality: charging for tethering, hard data caps, etc. is very scary.

    I’m sorry that T-Mo doesn’t cover your area but they aren’t as horrible as ATT.

    1. I love it. ONE CORNER IS IN EDGE LAND AND YOU SAY THAT IS EXCELLENT SERVICE! Wow. Dude, get Verizon. You’ll learn what a good consistent network is like.

      AT&T will kill TMobile’s cheaper plans eventually, by the way. They have to make back that $39 billion. Me? I’ve already paid my dues.

        1. That is going away with 4G networks, though, and Verizon is ahead even there. The iPhone will catch up to Android later this year, just watch.

  3. Hm. My droid was on Tmobile (it’s currently a pink flip giving me alternate phone service when needed due to the droid’s demise at the hands of my 1 y.o. niece) and their service here has always outdone AT&T and Verizon. My husband’s droid is still on it, as is the kidlet’s emergency mobile (for when she’s not with us – I can’t give her a quarter for a pay phone, and it has gps tracking for worst case scenarios) at $5/mo.

    Meanwhile, after waiting for 6 months to potentially get the iPhone 4 on Verizon, I re-upped with AT&T instead. I have my own Verizon horror stories. But what tipped my decision was the realization that there is no “good” mobile company. They all have glaring flaws. There’s no stand out.

    At some point, you have to hope that someone builds a cellular company that has the customer orientation of Zappos. But I’m not holding my breath. I don’t really advise anyone else to either. I just find the one with flaws I can live with and kvetch when necessary.

    1. Yup, that’s why this market is so sad. It’s too hard for a new company to get the infrastructure up to really take a customer approach. In the meantime, your cheaper TMobile rates will go away as it is brought into AT&T family. Maybe it will help AT&T, though. At least that might be a small win for consumers, albeit ones who are willing to pay AT&T rates (like me).

  4. Hey, guess what??? Verizon’s 4G/LTE network is GSM. Same as AT&T and T-Mobile’s networks. Yep, Verizon is switching to GSM. Look it up.

  5. A couple thoughts –
    How could T-Mobile possibly be worth $39 Billion? Deutsche Telekom is only worth $59 Billion and the majority of their value in in Europe (hence the name).
    Let’s hope that they ditch T-Mobile’s crap network, but keep their amazingly customer-friendly policies. They are definitely the nicest phone company by far.

    1. “They are definitely the nicest phone company by far.”

      There is that, I suppose.

      I was shocked the first time I spoke with a T-Mo rep on the phone. The person was actually competent and not a complete fool — unlike every single rep I ever had occasion to speak with at AT&T.

      I had been considering a return to T-Mo, as their network is fine here in Portland. Ah well.

  6. This makes me really sad. I wonder how the different manufactures will react to this. More carriers produced more phones which produced more options. So to see T-Mobile go is sad.

    However, its not all bad. T-Mobile issued a statement regarding the acquisition.

    In the statement they gave a few of the common questions they were asked and answer to them regarding the buy out. You can check it out here: goo.gl/hYN9u

  7. “You all know I really despise AT&T.” And I heartily loathe T-Mobile (not so much for the crappiness of their coverage as for the thieviness of their billing). So it’s a marriage made in hell!

  8. Are you aware not everyone in the US lives in your area/state/neighbored? Not everyone cares if it works in SF or California at all. The service where I have used it in the US has been very good, better than Verizon and much faster. The idea would be with these two networks together they can consolidate costs of Sales, Marketing, etc and continue to build faster,better data networks than that of Verizon and the competition. Bringing together the wider scale coverage of AT&T and the more city specific coverage T-Mobile offers could be a great outcome. The customer base is much different from the traditional AT&T customer and will add greatly to the general market presence and awareness with younger more data hungry generations, that AT&T+T is the way to go and not the limited US only Verizon.

  9. Wow, this junk article got posted on businessinsider.com? This should be destined for scoblesopinionsandwhining.com only. As hard as I expect it is for some people to understand, there doesn’t have to be a “cool” carrier and all the rest “suck”. The service you use depends entirely on where you live and where you travel to. I live in Raleigh, NC, and here I fully believe AT&T is the best network. You know how many dropped calls I’ve had? I was hoping you knew because I can’t remember the last time it happened. Why? Because AT&T has good service in my area. If I lived somewhere where they didn’t have service, I wouldn’t use them, but I wouldn’t go around crying about how “AT&T sucks cause they don’t have service in my town”.

    How about the reports of people who got the Verizon iPhone and had far worse service and many more dropped calls than on AT&T?

    Robert, I know you’re smart enough to understand coverage maps and understand that no carrier covers the entire country. So you don’t have AT&T service everywhere you go, well, as you said, you definitely don’t have Verizon’s ancient CDMA service in Europe, they both have their ups and downs. This kind of stuff really belongs on a message board full of little teenage kids arguing and not on a business related site.

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  11. Nope, this is why AT&T is ATTEMPTING to buy T-Mo: Here’s a perspective no one but me has offered. Speculation prior to this announcement was that Sprint was lashing up with T-Mobile, so it sounds like Big Mama AT&T didn’t like the looks of that and counter-bid with a huge $39B. However, I am positing that AT&T realized all along it was making an impotent bid, its real goal is simply TO BLOCK Sprint’s acquisition or merger with T-Mo. What a dick move, right ? So it gets a $3B penalty for not meeting reg approval, it’s a small price to pay to keep #3 and #4 from becoming a killer threat to #1/#2. And killer it could’ve been since no carrier partnership exists that offers both GSM and CDMA tech. This probably scared the spit out of AT&T, hence the ridiculous strategy play. I hate the re-constituted Ma Bell so much. (I’m a long-term Sprint customer.)

  12. Nope, this is why AT&T is ATTEMPTING to buy T-Mo: Here’s a perspective no one but me has offered. Speculation prior to this announcement was that Sprint was lashing up with T-Mobile, so it sounds like Big Mama AT&T didn’t like the looks of that and counter-bid with a huge $39B. However, I am positing that AT&T realized all along it was making an impotent bid, its real goal is simply TO BLOCK Sprint’s acquisition or merger with T-Mo. What a dick move, right ? So it gets a $3B penalty for not meeting reg approval, it’s a small price to pay to keep #3 and #4 from becoming a killer threat to #1/#2. And killer it could’ve been since no carrier partnership exists that offers both GSM and CDMA tech. This probably scared the spit out of AT&T, hence the ridiculous strategy play. I hate the re-constituted Ma Bell so much. (I’m a long-term Sprint customer.)

  13. There isn’t even enough competition NOW. With everyone locked into family plans on cell networks and broadband development completely dead, we’re behind Japan, Korea and half of Europe! If the Republicans REALLY try hard, we’ll soon be copying the Australians for broadband and begging Mexico to build our cell phone networks! By all means, let’s wait until we fall completely behind in a couple decades and your children live in tin roof shantys! No need to compete globally if you’re the GOP! The rest of the world doesn’t exist!

  14. I really hope this deal doesn’t go thru. Vz has the Worst client service of Any Company in any business.You might as well Call the Devil just to hear’em Laughing at you. I’ve been Lost in the Que until I just give up with AT&T.

    T-Mobile Knows Customer Service like a great restaurant. As long as coverage stinks west of Winchester, Is non existent in the pan handle of West Virginia.
    Service is the only Consideration

    T-Mobile Is tops and I would be Sorry to see them go! I don’t want a stinking armpit as service. All the other stuff talked about is junk. Cover West Virgina things would be different.
    The only thing that matters at this point is Service.
    Hands down T-Mobile is tops.
    They cost less and you don’t feel cheated after talking with them. More Competition is Needed not less.