The government already controls cell phones with its grip on the spectrum, consumer specifications, and the endless cellular carrier regulations. Now the Feds are telling the cellular carriers that they cannot merge. They also want to make sure you don’t talk and drive at the same time.
AT&T-T and Mobile Merger Dead
The big news this week is that AT&T withdrew its bid to purchase T-Mobile for $39 billion. The Justice Department’s suit against AT&T and the FCC’s disapproval finally made AT&T kill the whole deal. Our government was only doing its job by trying to protect us from the nasty big businesses. Of course.
The AT&T deal seemed to be a win-win for everyone but not in the eyes of the government. With T-Mobile’s spectrum, network and other assets, AT&T could expand its network to a broader part of the U.S. improving its service and reliability. According to surveys, AT&T has had the worst cellular service. The company was responding to this problem. Furthermore AT&T would have the additional spectrum to expand its LTE networks to meet the escalating demand for video, rural broadband, and other bandwidth intensive services. Even the unions wanted the deal to go through. Now what happens?
AT&T will survive and prosper and will meet its needs in other ways. The big loser may be T-Mobile. It is the fourth largest cellular provider in the U.S. It has an excellent 3G HSPA+ 42 Mb/s network but its subscriber volume is in decline. The owner Deutsche Telekom AG wants to exit the U.S. cellular market. It has not provided the funds to help T-Mobile build out an LTE network like everyone else. At some point, T-Mobile is going to go down because of a declining share. It is also the only one of the big four carriers that does not have the iPhone, a major disadvantage. So while the government stopped the acquisition to protect competition, it may see competition disappear anyway.
T-Mobile gets a seven year roaming deal and some AWS (1.7 GHz) spectrum from AT&T out of the cancellation. That’s positive, but T-Mobile really needs a solid plan B. Maybe another carrier or MSO (cable company) will come along with an acquisition offer that will fit the DOJ’s idea of a good merger. Joint ventures could also help.
The government says it stopped the deal to protect the consumer from the loss of competition, higher prices and the inevitable loss of jobs that such mergers bring about. Maybe. Mergers are what they are and they are often good for business and the consumer. All that remains to be seen. It is the way of our capitalist system. As for competition, there is more than enough of that from Verizon, Sprint, Leap, MetroPCS and others. Besides, the direction of a cellular company and its pricing today is determined not only by the competition but more so by the market, the consumer and the technology. What the devil does the Justice Department know about that?
And oh, by the way, the DOJ is now scrutinizing Verizon’s offer to buy spectrum from Comcast, Time Warner and Bright House Networks. The idea is for Verizon to build out its networks and offer these companies wholesale wireless so they can sell mobile service to their customers. Verizon is actually bigger than AT&T so are they just as bad? Wonder how that is going to turn out?
I hate to see the AT&T and T-Mobile deal go away but I predicted that it would. AT&T will survive but the fate of T-Mobile, even with the $4 billion in assets AT&T has to pay them, is up in the air. Even though T-Mobile’s cute girl in the magenta dress is a huge asset, it may not be enough to keep T-Mobile and its excellent service and network here.
No Texting, Talking and Driving
Another potential encroachment of the government in the use of our cell phones is the National Highway Safety Board’s recent appeal to State governments to enact regulations for stopping not only texting (which actually makes sense) but also talking on a cell phone while driving. Some states already have such laws in place. Does this cut down on accidents? Supposedly, but there are few if any statistics to validate that. Again, the government wants to protect us from ourselves. If you haven’t already figured out that texting and talking are distractions that can cause accidents, you probably shouldn’t be allowed to have a cell phone. I basically do not make calls while I drive. I do answer calls, but the Bluetooth hands-free feature in my VW GTI makes it easy and less distracting to answer. It is a minor distraction, yet, I just don’t want the government telling me what I already know or suspect.
Which leads me to ask “whatever happened to common sense?” Don’t people recognize that all the stuff they do in the car besides driving is distracting. Don’t we all know that eating, drinking, smoking, putting on make-up, shaving and even listening to the radio or iPod is a diversion of one’s attention? I think fiddling with a GPS PND is more distracting than anything else, yet auto manufacturers are putting GPS nav systems with huge dashboard screens right near the driver. What’s next, TV? Even talking to someone or disciplining kids in the car is a distraction. Why not ban all of those things while you are at it?
A recent survey by Poll Position, a news and polling organization, indicated that 49%-44% of Americans favored the NTSB’s recommendation. Breaking the survey down, the elderly support the ban by 60%, the Democrats support it by 55%-44%, Republicans oppose it by 50%-46% and Independents support it by a margin of 48%-41%. There is obviously major backing for something like this.
Some states will go along with the NTSB’s plea while others won’t. Maybe it will do some good. I just wish more of our population would be more responsible about such matters so that regulation is not the only answer.
Sorry for the rant.
On a Happier Note
My daughter recently found a brand new iPhone 4S lying in the parking lot of a restaurant she was leaving. It was not damaged but was discharged. She took it home and recharged it. Once the phone came on it was located by Verizon’s 911 technology at an address near her. She was able to find the owner and call him. He immediately came by to claim his phone. My daughter said he was distraught and worried and even panicked by losing the phone. Apparently he had his full life on the phone which included his address and phone book, business client list, music and social media links. He was so grateful, he gave her the $38 he had on him plus a couple of theater tickets. And he left her with a big hug.
More and more people are putting everything of any importance on their cell phone. The phone controls more of our lives than we suspect. This is a good example of the power and influence of the smartphone particularly. The lesson here is to prepare. What would you do if you lost your smartphone? What are you doing about it?
Merry Christmas to you all.