AT&T working out a deal with Leap for a last effort to save the T-Mobile merge

AT&T working out a deal with Leap for a last effort to save the T-Mobile merge
Just two days ago, we heard that AT&T will push probably for one last time in order to get the T-Mobile acquisition through and two names have been mentioned by Bloomberg already - MetroPCS and Leap Wireless. 

Now, the NY Times adds fuel to the fire with its own inside scoop - AT&T is reportedly close to working out a deal with Leap Wireless, representing Cricket and Jump Wireless, a company with revenues of only $700 million a year. Still, it could turn out to be a deal of paramount importance, pushing Leap to become the nation’s fourth biggest carrier. The Leap deal obviously is AT&T’s understanding of courting the Justice Department - it will sell a huge chunk of T-Mo customer accounts and spectrum to buy itself a nod from the government.

The plan to create another huge carrier to fill in the T-Mobile gap however raises plenty of questions itself and doesn’t directly address the duopoly issue arising after the AT&T and T-Mobile merger. The most likely outcome would be that Sprint and Leap Wireless, would still trail behind AT&T and Verizon a great deal, so they wouldn’t really pose a competitive threat.

No wonder it’s a last resort solution for AT&T - it’s far from certain. What seems certain however is that the second-biggest carrier will have to pay $4 billion to Deutsche Telekom if the acquisition doesn’t go through. The final outcome will soon be known, so stay tuned to see the end of this saga.

source: NY Times

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32 Comments

1. Alantef

Posts: 288; Member since: Sep 14, 2011

noooooooo!

8. Alantef

Posts: 288; Member since: Sep 14, 2011

i said it months and months ago....i really think Google should by tmobile

10. remixfa

Posts: 14605; Member since: Dec 19, 2008

i would totally go for that. i wouldnt mind working for google at all. :)

13. bsilva1182

Posts: 5; Member since: Dec 07, 2010

I completely agree, g-mobile FTW!!!

12. lubba

Posts: 1313; Member since: Jan 17, 2011

It would be better for you and all your google loving friends that Apple buy Tmo and dump all of you on a remote google fantasy island. You can skip, hop, and hold hands together everyday with a cute smile seeing everything around you is made by google; google house, cars, bikes, cake, tea, etc.. Your lives will be so googly!

15. bsilva1182

Posts: 5; Member since: Dec 07, 2010

haha, apple oh you crazy apple fanboys, are you sure this isnt the place where all of you apple lovers live!!

21. lubba

Posts: 1313; Member since: Jan 17, 2011

Not apple fan. Just annoyed hearing that kind of stuff. though i will side with apple in certain cases. Lolzz!!!

2. hepresearch unregistered

hahaha... funny... So, we will be taking T-Mobile USA out of the #4 spot, and replacing them with Leap Wireless? AT&T is cannibalizing them just for the spectrum, apparently, and will be handing off the massive leftovers to Leap... I wonder what Leap will be paying for it? So, how in the world will Leap integrate a GSM network, larger than their own home CDMA network, into their own? And, if they do (maybe by just replacing the GSM equipment with CDMA), then are they a good merger/takeover target for Sprint?

3. jamrockjones

Posts: 345; Member since: Oct 26, 2011

I still don't think it will happen.

4. networkdood

Posts: 6330; Member since: Mar 31, 2010

T-Mo's parent wants to sell it - so, if not AT&T, then who, SPRINT? Can Sprint really buy another company and handle even more debt? Can it handle integrating more spectrum into its already varied group of spectrum? Do we really want to start telling companies who they can and cannot sell to? You may as well as sell T-Mo to the government and then the gov't could create their own national network for those who cannot afford private cell service....just like health care.

5. hepresearch unregistered

Subsidized by the tax-payer... Socialized Mobile! Nasty...

6. networkdood

Posts: 6330; Member since: Mar 31, 2010

LOL - Everyone wants to SPRINT to buy T-MO - do they realize hoe much in debt they are right now? Maybe it would help them, though with their LTE buildout. Let LEAP buy the whole company.

11. remixfa

Posts: 14605; Member since: Dec 19, 2008

not only do they have too much debt to take on more, their networks are incompatable. you think the IDEN junk was a bad idea? try merging a GSM and CDMA carrier with opposing technology. Besides, Tmobile has the better setup speedwise, so it would make more sense for sprint to convert all its towers to GSM and ride that 42mb/s HSPA+ over its 12mb/s Wimax. That deal would ONLY make sense if they were announcing a joint LTE roaming venture with a merge after the LTE roll out is complete and they were ready to turn off the CDMA towers and go LTE/GSM (again, Tmobile's backhaul is muuuch faster)

17. ojdidit84

Posts: 462; Member since: Jul 16, 2011

It would be the same thing with LEAP Wireless. They use they same CDMA technologies as Verizon/Sprint and T-mo has so many more customers than LEAP. In that case it would make sense for them to turn off or convert their CDMA towers and go GSM. IDEN/TDMA was also incomplatible with CDMA and it's taking that forever to be killed off in favor of Sprint's CDMA network. But in the case of Sprint/T-mo, Sprint has almost twice as many customers as T-mo so how would it be more cost effective to switch to GSM/LTE technologies over CDMA/LTE technologies? Unless you're confusing WiMax as a CDMA technology and LTE as a GSM technology in which they are neither. Either way, I'd hate to see T-mo get gobbled up by ATT only for a huge chunk of customers to be sold off to a carrier like LEAP (who doesn't even have coverage in a large city like LA) just to gain their spectrum and I still don't see how it would create all these jobs they say it will. I could only see customers running away from the sound of Cricket and heading to the other big 3.

24. remixfa

Posts: 14605; Member since: Dec 19, 2008

Sprint does have more customers, thats true. But going GSM would give them more phone options, which would make the customers happier... it would allow them to have a much faster non LTE backhaul when the upgrades are done (HSPA+ @42mb/s compared to CDMA 3g at 2mb/s)... LTE is a GSM evolution so its more easily compatable. Remeber how many issues VZW had with LTE at first? Sprint will go through the same growing pains. So.. IF sprint and Tmo merged.. and stayed sprint you would have.. less phone choice (more phones go GSM since they are more easily available on more carriers), slower "3g", and more possible cdma/lte incompatibilities. Wimax and IDEN would be out the window regardless.

27. hepresearch unregistered

GSM is no more compatible with LTE than CDMA is... they are all relatively unrelated technologies. If anything, LTE appears to share the same encryption as GSM/3G in the A5/3 algorithm, but A5/3 is seriously substandard when compared to the CAVE algorithm used with CDMA. Also, CDMA is better at sharing bandwidth between more users at one time, and is nearly impossible to eavesdrop on (thanks to a 42-bit pseudo-random signal scrambling overlay)... Ev-DO Rev. A may not be as fast as HSPA, but it is quite secure, and CDMA voice service is just as nice and clear as UMTS voice service with the same momentary user load per tower. iDEN is soon to be out of the way... thank goodness, and WiMAX will eventually disappear in favor of LTE, as well.

29. remixfa

Posts: 14605; Member since: Dec 19, 2008

lol, I never said CDMA wasnt the better tech. Between its building penetration, longer distances between towers, and everything else, its the much better tech. But there are trade offs with that. The only phones that use 42/mbs are the Hercules and Amaze, so unless you know peeps with that, of course u havent seen it. Real world that ive seen running speed test in store is high 20s/ low 30's at its highest. Average is anywhere between 12-20. Wimax's MAX theoretical is 12.5 Most people get between 3-8 at best on wimax. Wimax is all but dead. With clearwire and sprint both making LTE plans, Wimax will be abandoned in America. So no matter what happens, wimax wont exist for too much longer. Life is a trade off. CDMA gives u better coverage, but so will converting all those towers to GSM and having some overlap. GSM gives u more phone choices and faster non LTE backhaul. And as customers have proven, they were willing to switch from carriers with better service (everyone but ATT) and move to ATT in droves for a silly iphone. They care more about the device than they do about their ability to use it... well at least a large portion of customers.

30. hepresearch unregistered

haha... fair enough. I was unaware that WiMAX had such a low theoretical speed to begin with... it does not seem to make sense, though, when both LTE and WiMAX share the exact same technology base (OFDMA).

31. ojdidit84

Posts: 462; Member since: Jul 16, 2011

Actually, WiMax's theoretical max is 75 mbps. Where are you getting 12.5 from? Actual max perhaps? It SHOULD be getting higher speeds than it does but when you have Clearwire managing the network, not going to happen... lol Either way, I agree that WiMax is dead thanks to mis-management from Clearwire with sub-par speeds and terrible rollouts that didn't even reach major cities like San Diego or Phoenix before it all pretty much came to a halt a little over a year after its release. Won't miss it one bit in favor of LTE and LTE-Advanced.

18. LewsTherin006

Posts: 140; Member since: Nov 18, 2011

i have thought about that myself. Only thing is sprint doesnt have a very good track record when it comes to making good choices with their network. or they could even just have dual service phones until the merger takes place.

28. hepresearch unregistered

Strangely, the iPhone 4S actually fits the bill as just such a dual-service phone... just without T-Mo 3G/HSPA+ (no AWS radio support).

26. hepresearch unregistered

HSPA+... 42 Mbps is the theoretical speed WiMAX... 12 Mbps is a reported real-world speed I do not know anyone who has ever actually seen anything even close to 42 Mbps on HSPA+, and the theoretical speed of WiMAX is comparable to HSPA+ anyway. And, I was under the impression that GSM carriers are facing worse backhaul problems than the CDMA carriers... in my opinion, LTE/CDMA seems the better way to aim for transition in the event that T-Mo ends up having infrastructure divested into the hands of Sprint and/or Leap Wireless. Sprint has plenty of room for LTE spectrum at 2500 MHz (through Clearwire) in the cities, and enough room at 800 MHz to work with LTE build-out elsewhere. Either way, trying to merge GSM and CDMA networks will be just as messy as when Sprint tried horking down Nextel... it was all down hill once they got past the gag-reflex.

7. LewsTherin006

Posts: 140; Member since: Nov 18, 2011

DTwas in talks with 5 people to buy Tmo. We dont know the other 3. Tmobile will get sold and stay alive. All it takes is someone who somewhat knows how to manage a company. DT has done a HORRIBLE job managing Tmobile.

9. vvelez5

Posts: 623; Member since: Jan 29, 2011

Like I said before there is always someone who wants to get in the game. One company loses another takes its place.

14. lubba

Posts: 1313; Member since: Jan 17, 2011

One thing i dont understand is why DT not restructure Tmo US, maybe get rid of old ceos, layoffs, or even new strategy? They don't have to sell. They can restructure.

23. vvelez5

Posts: 623; Member since: Jan 29, 2011

But what if they don\'t want to restructure and just sell?

16. Carlitos

Posts: 663; Member since: Oct 23, 2011

Just what I have been saying. (But not leap wireless, I was thinking metro, or the carrier before that) If this deal is true, I can see the tide turning to At&t favor.

19. downphoenix

Posts: 3165; Member since: Jun 19, 2010

AT&T is really desperate to push this deal through, its the only way they will surpass Verizon in number of subscribers.

20. rockstarlive

Posts: 307; Member since: Oct 19, 2011

AT&T decided to withdraw from the deal. Its over.

25. networkdood

Posts: 6330; Member since: Mar 31, 2010

No, not over yet...keep reading newer articles on it.

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