AT&T Acquires T-Mobile For $39 Billion, Would Make AT&T the Largest US Mobile Network

In a press release issued just a few hours ago, AT&T and Deutsche Telekom announced an agreement that will see T-Mobile US acquired by AT&T for $39 billion.

The deal will have to get the government’s stamp of approval before becoming final, but should the acquisition pass FCC scrutiny it would make AT&T the largest US mobile network, and the only US GSM mobile network.

AT&T had roughly 95 million wireless customers at the end of 2010, and combined with T-Mobile’s nearly 34 million, AT&T-Mobile would have approximately 129 million customers to Verizon’s 94 million. {Business Insider} Sprint, the only other major mobile carrier has approximately 50 million customers, and is a CDMA network like Verizon, which could make them an acquisition target if Verizon decides to compete with AT&T on similar terms.

For T-Mobile customers there will be advantages and disadvantages should the deal be approved. The positives include access to more devices, including the iPhone, which could mean benefits for Apple as well if 34 million customers suddenly have the ability to upgrade or switch to the device. Also, AT&T’s 4G LTE wireless would be available to T-Mobile customers. Not included in the press release, but something worth considering is that adding T-Mobile’s towers might help AT&T with reliability which is notoriously spotty in major cities like New York and San Francisco.

Now, the negatives, and the things that we hope government bodies will cover. In general, fewer networks means less choice for consumers and the risk of higher prices. T-Mobile’s prices in many cases are significantly lower than AT&T’s. In our smartphone network comparison, we found T-Mobile to be as much as $800 less expensive than AT&T on a 2-year contract. If they’re acquired by AT&T, there would be no reason for them to offer lower pricing. It would also mean that AT&T would become the only GSM network in the US, which could mean international carriers (many of whom run on GSM networks) would have only one partner option for roaming. Which in turn could spell higher rates for Americans roaming abroad and foreigners roaming in the US.

If AT&T does acquire T-Mobile, they’ll offer consumers faster wireless and more devices, but it’s very likely to come at a price.