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AT&T Inc. has agreed to buy T-Mobile USA for $39
billion, but the deal isn't set to close until a year from now, and
it will likely face tough regulatory scrutiny. Here's what a
completed deal could mean for customers:


      • Some time after the deal is completed, T-Mobile phones with
"3G" wireless broadband won't get 3G service any more, and will
need to be replaced. AT&T will be offering new phones with access
to AT&T's 3G network to these customers, but it's not clear what
the deals will be. It could take a year for AT&T to turn off
T-Mobile 3G, so there will be time to adjust. AT&T will use
T-Mobile's 3G frequencies for 4G instead, for faster data speeds.


      • More phone choices for T-Mobile subscribers. T-Mobile, as a
much smaller carrier than AT&T, doesn't get as many exclusives on
top-line phones, and it doesn't have the iPhone. This won't be a
big benefit to T-Mobile subscribers who don't have contracts - if
they want the iPhone today, they can sign up with AT&T or Verizon
Wireless. But subscribers under contract would find it easier to
upgrade to an iPhone.


      • Fewer pricing plans to choose from. T-Mobile and AT&T have
different offerings, some of which might disappear from the market.


      • No more unlimited data plans. AT&T has stopped offering
unlimited data plans in favor of plans with monthly data usage caps
and overage fees. T-Mobile USA still offers "unlimited" data for
smartphones for $30 per month, but slows downloads after 5
gigabytes of traffic in a month. If the deal closes, current
"unlimited" subscribers would likely be grandfathered in, but
AT&T would probably stop offering the plan to new subscribers.


      • Better network coverage. Combining the two networks will
improve performance is some areas, because there will be more
towers available. However, today's AT&T phones can't use T-Mobile's
3G wireless data network, and vice versa, because they run on
different frequencies.


      • Wider rural broadband coverage. AT&T is pledging to increase
spending on the construction of a new ultrafast broadband network
by $8 billion, to cover rural areas.

      • The big question is whether the combination would let AT&T,
Verizon and Sprint raise prices on wireless service once
competition from T-Mobile disappears. AT&T points out that prices
have fallen through a decade of mergers in the industry, but
public-interest groups are raising concerns.
      

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AT&T to buy T-Mobile USA for $39 billion

Business and Economic News

AT&T Inc. has agreed to buy T-Mobile USA for $39
billion, but the deal isn't set to close until a year from now, and it will likely face tough regulatory scrutiny.

What AT&T's plan to buy T-Mobile could mean for customers

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