AT&T Buys T-Mobile to Create America's Largest Mobile Phone Company Shortly After Three of the Top Four Announced a Joint Venture to Standardize Mobile Payments
Banks and Mobile Operators to Go Head to Head for Mobile Payments Business
In 2003, for the first time, electronic payments surpassed cash and checks as consumers’ preferred payment method for in-store purchases. What we may see in the near future is the convergence of mobile operators and banking institutions, with consumers deciding that a mobile phone rather than a plastic card in their wallet is about all the bank they will need.January 14, 2010
NearFieldCommunicationsWorld.com - Banks and mobile network operators are set to go head to head in a bid to control the market for NFC mobile payments services. NFC mobile phones will be used to replace everything from credit cards and loyalty cards to bus and train tickets, library cards, door keys and even cash.
What hasn't yet been decided, however, is who will win the battle to provide consumers with their new hi-tech mobile wallets. So far, banks and operators have worked together to run field trials of NFC technology but the emergence of new ways to add near field communication technology to existing mobile phones means they will soon find themselves in competition for control of this important new market.
New products are now available that enable NFC functionality to be retrofitted to current mobile phones. These will enable banks to deliver NFC services to their customers without the involvement of mobile network operators, and this has fundamentally changed the balance of power between banks and operators.
While a collaborative approach between banks and operators may work in some instances, 'NFC: The Road to Commercial Deployment' predicts that most commercial deployments will have only one lead player. And that lead player will not necessarily be a mobile network operator. Decisions made in 2010 will be critical in determining which mobile network operators, which banks, which industry suppliers and which service providers become the leaders in the field.
Ultimately, only two or three companies in each country will succeed in building a major new business providing NFC services to businesses and consumers. The winners could be banks or mobile operators, or even a new entrant to the market. We now expect a competitive market to develop between mobile operators and banks in each market. Overall leadership will not be determined by what business the company is currently in; instead, it will be based on their overall business strength, on how well they execute their NFC strategy, and on the alliances that they put into place.
Strong banks, for instance, will be able to make deals with weaker mobile network operators. And strong mobile network operators will make deals with weaker banks so that, ultimately, who ends up as a lead player in each market will depend not on whether they are a bank or an operator but on other key factors.
AT&T to Buy T-Mobile Unit for $39 Billion in Cash, Stock to Create America's Largest Mobile Phone Company
AT&T agreed to buy T-Mobile USA from Germany's Deutsche Telekom for $39 billion in a blockbuster deal in the wireless telecom sector. As part of the transaction, Deutsche Telekom will receive an equity stake in AT&T that of around eight percent, and a representative of the German firm will join the AT&T board. The cash portion of the purchase price will be financed with new debt and cash on AT&T's balance sheet. AT&T has an 18-month commitment of $20 billion underwritten by JP Morgan. The deal will give AT&T a big boost in its rivalry with Verizon, which recently started selling the Apple iPhone with an end to the AT&T monopoly. Analysts said the deal also helps AT&T in the so-called 4G sector offering more advanced wireless services. - ATT to Buy T-Mobile USA for $39 Billion, AFP, March 20, 2011March 20, 2011
Bloomberg - AT&T Inc. (T) agreed to buy T-Mobile USA from Deutsche Telekom AG (DTE) in a cash-and-stock transaction currently valued at about $39 billion, a combination that would create America’s largest mobile-phone company.
The purchase price will include $25 billion in cash and the balance in AT&T stock, subject to adjustment, according to a statement today. The deal may give Deutsche Telekom an 8 percent stake in the Dallas-based carrier, which will add a Deutsche Telekom executive to its board of directors.
If completed, the deal would allow AT&T, now the second- largest U.S. wireless operator, to add 34 million customers and surpass Verizon Wireless as the largest in the country. The acquisition, the largest in the wireless industry since 2004, may face regulatory scrutiny because it combines the second- and fourth-largest wireless providers.
“This is a very surprising deal,” Jonathan Atkin, an analyst at RBC Capital Markets, said in an interview. “AT&T is certainly buying scale. AT&T can integrate T-Mobile from an operations standpoint fairly easily because they use the same technology.”
AT&T said that it would expand the rollout of its high- speed wireless technology, called Long-Term Evolution, or LTE, under the T-Mobile agreement. AT&T will offer the service to an additional 46.5 million people as part of the deal, helping achieve the Federal Communications Commission goal of making broadband available more widely, the company said.
“This transaction represents a major commitment to strengthen and expand critical infrastructure for our nation’s future,” Randall Stephenson, AT&T chairman and chief executive officer, said in a statement. “It will improve network quality, and it will bring advanced LTE capabilities to more than 294 million people. Mobile broadband networks drive economic opportunity everywhere.”
The agreement has been approved by the boards of Directors of both companies, Deutsche Telekom said in a statement.
The cash part of the purchase price will be financed from the holdings on AT&T’s balance sheet and new debt, the company said. AT&T has an 18-month commitment for a $20 billion unsecured bridge loan from JPMorgan Chase & Co. (JPM). The company is not assuming any debt from T-Mobile or Deutsche Telekom.
The deal is the largest for AT&T since the acquisition of BellSouth Corp. in 2006 for about $83 billion, according to data compiled by Bloomberg.
It’s the largest takeover to be announced in the wireless industry worldwide since 2004, when Sprint agreed to merge with Nextel Communications Inc., and the sixth-largest mobile-phone deal of all time.
The T-Mobile transaction, subject to regulatory approval, is expected to close in about a year, AT&T said. AT&T was advised by JPMorgan, Greenhill & Co. and Evercore Partners on the deal.
The Largest U.S. Phone Companies
January 31, 2011eHow - Here is a list of the five largest mobile phone companies in the U.S. by total subscribers based on March 2009 numbers:
1. Verizon Wireless: 86.6 million subscribers
2. AT&T Mobility: 78.2 million subscribers
3. Sprint Nextel: 49.083 million subscribers
4. T-Mobile: 33.173 million subscribers
5. TracFone Wireless: 11.759 million subscribers
Verizon ranks 15th in the world for total subscribers.
Largest Bank Holding Companies in the U.S.
Here is a list of the 50 largest bank holding companies in the United States ranked by total domestic deposits. (dollar amounts in thousands)
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