AT&T buys T-Mobile for $39 billion, to form America's largest carrier if the deal gets approved

AT&T buys T-Mobile for $39 billion, to form America's largest carrier if the deal gets approved
UPDATED: AT&T presentation slides, Deutsche Telekom's stake.

Now this makes much more sense - unlike the rumor that Sprint will be buying T-Mobile, it turned out that actually the carrier that uses the same GSM technology - AT&T - is buying Big Magenta, for $39 billion in cash and stocks.

Deutsche Telekom will receive $25 billion in cash, and $14 billion in stocks, some of which it will use to pay off debt and for share buybacks, plus it will get 8% stake in AT&T because of the stock portion. The German telecom acquired T-Mobile (previously VoiceStream), for $24 billion in 2001 - not as bad of a deal as some thought, it turns out.

It was the logical thing to happen ever since Deutsche Telekom put T-Mobile on the market. The buyout will add 34 million subscribers to AT&T's count, and create the largest US carrier with 130 million customers in a year's time, when the deal is expected to clear the red tape. If it gets the antitrust authorities approval, of course. AT&T is holding a press conference tomorrow to talk us into it, so we will tune it at 8am Eastern for the gulp of Kool-Aid, meant for the FCC, since all companies' boards involved have already approved it. If for some reason the deal doesn't go through, AT&T is on the hook to pay T-Mobile child support to the tune of $3 billion for the break-up, according to the agreement.

Well, at least now the 4G LTE plans will get a huge boost, when the 700MHz spectrum of AT&T, and T-Mo's AWS frequencies combine, and that's precisely what AT&T means to do, according to the press release. Combining both carriers' airwaves, it said, will allow the new GSM behemoth to reach 95% (294 million) of Americans with its upcoming LTE network - 46.5 million more than if AT&T was doing it alone.

From the presser: "AT&T and T-Mobile USA customers will see service improvements - including improved voice quality - as a result of additional spectrum, increased cell tower density and broader network infrastructure. At closing, AT&T will immediately gain cell sites equivalent to what would have taken on average five years to build without the transaction, and double that in some markets.  The combination will increase AT&T’s network density by approximately 30 percent in some of its most populated areas, while avoiding the need to construct additional cell towers."

Here are some slides explaining the synergies, plus AT&T cherry-picking states to show us the brave new world we could live in as soon as next year:

On the flip side, this probably will end T-Mo's tradition of being the bargain carrier. It might also take some phones off the portfolio of the resulting telco, due to overlapping, but, in that respect, manufacturers will do wonders with their newest handsets just to get the attention of America's biggest carrier, so it might all turn out for the better.

Not to mention the awards T-Mo has gotten on a more than few occasions for excellent customer service and overall satisfaction. Of course, everything is puppies and flowers, according to AT&T, which has inserted some twisted logic into a slide sure meant to appease Uncle Sam's antitrust regulators, but not really backed up by anything of substance, except for the timeline:

Verizon and Sprint are probably less than thrilled by this development. What do you think, will that surprise move stifle competition in the US, or will we benefit from the apparent synergies between the two GSM carriers?

source: AT&T



1. BobbyTaba

Posts: 316; Member since: Aug 11, 2010

Verizon buy Sprint!

6. zafrir

Posts: 10; Member since: Dec 31, 2009

I think that if AT&T's buyout of T-Mobile gets approved, Verizon will attempt to buy out Sprint. Verizon loves to be the top player in the cellular phone industry. I am not a big fan of buyouts, however. The less cellular phone companies there are to choose from, the fewer the choices which leads to higher prices.

75. KParks23

Posts: 729; Member since: Oct 13, 2010

The real question is what will happen with the NBA T-Mobile halftime report??????? NOOOOOOOOOOOO LOL

97. cellgeek82

Posts: 518; Member since: Dec 20, 2009

It'll become the Blue Ball report haha.

107. jogutier

Posts: 324; Member since: Feb 12, 2010

Another big carrier destroying a little one. lol I hope for T-Mobile's customers that this doesn't turn into what Sprint did to Nextel. :( NO BUENO!

168. Brook tmobile unregistered

I dont think you can consider a company like T-mobile to be a little carrier?!?!? When being bought for twice your value it must mean a little bit more then being a little company in the way of giants. little more respect for the magenta please.

138. KParks23

Posts: 729; Member since: Oct 13, 2010

LMAO... Welcome to the NBA AT&t Blue Ball report!

109. speakdatruth

Posts: 24; Member since: Feb 04, 2011

Will D Wade and Sir Charles "Nucklehead" Barkley continue to be the official spokesmen.......

33. king ty unregistered

no way. Verizon might buy us cellular

74. KParks23

Posts: 729; Member since: Oct 13, 2010

yea thats not going to happen sprint is getting better and better each year and with the phones and stuff they are coming with soon and switch to LTE! sprint is bigger than you all think the east coast is blanketed with service not sure why everyone is putting them down still?? get over it they sucked in the past but that was the past the last couple years with the new ceo they have really turned it around.... look at how MOTO was before the DROID 1

76. KParks23

Posts: 729; Member since: Oct 13, 2010

On another note im kinda pissed look at the phones TMO and ATT got coming out INSPIRE 4G, G2X, HTC pyrimid..... man step it up verizon WTF

123. tboz unregistered

vzw has htc thunderbolt coming - which can do voice and data at the same time. also has driod bionic coming.

139. KParks23

Posts: 729; Member since: Oct 13, 2010

MOTO sucks and tbolt is out already and has a sucky TFT screen and crap battery life

153. You Idiot unregistered

By the way, Sprint uses WiMax for 4g, not LTE you idiot.

155. Halcyon742

Posts: 1; Member since: Mar 23, 2011

Sprint is switching to LTE. Get your facts straight before you make yourself look like an idiot.

2. XxVerbalxX unregistered


11. remixfa

Posts: 14605; Member since: Dec 19, 2008

hooray!! that company that kept winning customer service awards, while giving great service to many americans for nearly half the cost of ATT and VZW, while being faster than EVERYONE else, having the largest 4g network, as well as the most android phones with the least amount of carrier crap on them is dead!!! Now EVERYONE can overpay for ATT service!!! woo hooo!!! yaaay!! Who needs unlimited everything for $79 with 21mb/s 4g when you can have.. non unlimited with 4gigs of service on a slower network for $145!?!?! yaaaay!! your right!! its awesome that the Evil Empire is absorbing them. Im sure that will be GREAT for cellular competition driving prices down!!!! Yup, VZW and ATT will have all sorts of reasons to NEVER lower their prices. VZW wont buy sprint. However, either sprint or VZW will probably snag metroPCS for the bump in subscribers and the fact that they are all CDMA (and metro has LTE and sprint wants it)

20. XxVerbalxX unregistered

weird how deucheland telecom sold to at&t even tho they didnt own the company huh? they prices they had were too cheap, they didnt have the assets to roll out a real nationwide network. they kept prices down and they still were losing customers year over year. lesson learned: customer service and pricing take a back seat to actually having a signal. t-mobile sucked and the industry is better without them. maybe metro or us cell will step up to #4. either way good riddance.

92. remixfa

Posts: 14605; Member since: Dec 19, 2008

lol. ur funny. I have tmobile and i never have an issue with signal. 4g is a wonderful thing. If they dont work in ur area, too bad for u, but for those that are in the coverage, the service is great. I live in a metro area and even here ATT has the worst signal of the major carriers. They are the ones that suck. High prices dont mean high standards. I have a 2000 mile round trip comming up this week, ill let ya know how "crappy" the service was... and im crossing the appalachian mountains twice.

110. XxVerbalxX unregistered

actually in about a year u have at&t. enjoy it.

157. remixfa

Posts: 14605; Member since: Dec 19, 2008

wrong, in a year ill have Tmobile with enhanced coverage area, as ill still be on my tmo phone, with my tmo employee plan, running my super fast tmo 4g network... but ill get the benefit of the larger calling area since thats the only thing ill be sharing with ATT. :) looks like i win.

169. Brook tmobile unregistered

you sir have no clue what you are talking about. deutsch telekom does own t-mobile, and t-mobile is a nationwide service provider. Also their assets as well as profits have increased every year since they were established. sorry you had a bad run with them and probably couldnt pay their "cheap" prices. Good riddance to you i hope you enjoy your month to month boost phone!

3. thats asinine unregistered

is this at&t's way of getting 4g?

19. Arod unregistered

um ATT has more HSPA+ (4G) coverage than tmo they just dont advertise it as heavy. now theyll have a lot more in addition... awsome

119. jbash

Posts: 345; Member since: Feb 07, 2011

they have more HSPA+ but have no bandwith to make any descent numbers. maybe the crapple fans will see how fast their phones can go with a little spectrum in thier life.

4. depeche

Posts: 63; Member since: Feb 04, 2011

I just left Sprint and joined T-mobile... I am not sure I am 100% happy with this.. Sprint will have to pick up the pace or they will be bought out as well. At least VZW and Sprint are more compatable then not... T-Mobile has the 1700mhz band with which will now either die out or be utilized AT&T

5. depeche

Posts: 63; Member since: Feb 04, 2011

Yes, at least I have 4G for the Next 12 months

90. DaxDroid unregistered

4G??? Really ??? Just because they overclocking their network doesn't make them "4G"... Now VZW, Sprint, Metro PCS have either WiMax or LTE which in terms of network generations its 4G, not 3G on Steroids

156. luis_lopez_351

Posts: 951; Member since: Nov 18, 2010

LTE is 4G until it reaches 100 mbps but wait it hasn't, So there for its referred to PreLTE??? HSPA+, Wimax, LTE will soon reach 100 mbps so eventually HSPA+ will be 4G but for right now its Bull all carriers are selling you bull. Also, "Overclocking their network" atleast they are improving their speeds, stop hating.

7. Tre-Nitty

Posts: 470; Member since: Nov 16, 2010

Your late pa. Anyway att is a powerhouse and this makes their 4g transition easier.

Latest Stories

This copy is for your personal, non-commercial use only. You can order presentation-ready copies for distribution to your colleagues, clients or customers at or use the Reprints & Permissions tool that appears at the bottom of each web page. Visit for samples and additional information.