Research, analysis, and thought leadership for enterprise communications.

Cellular Merger Madness

by in Telecom

I was genuinely surprised when AT&T saw the answer to its service problems being to spend $50 Billion acquiring Direct TV.

$50 Billion is enough money to install ONE MILLION CELL TOWERS. Think about it. If AT&T had installed one million cellular towers there would be five-bar coverage inside your nearest volcano. With one million more cell towers they would be so close you could string cables between them and zip-line from coast to coast. Seriously, I don’t think you could physically install one million more cellular towers in America.

I have to ask the question of why good coverage isn’t important in the cellular industry. I have no answer for this. If AT&T had just installed 100,000 Towers (at a tenth the cost of buying a Direct TV) they would have had such good coverage everybody would want their service. Why didn’t they do that? Why is coverage so unimportant?

It’s similar to T-Mobile’s potential merger with Dish network.

The public just accepts that companies merge and that there is a reason for it. Probably. Some reason. Isn’t there?

But I keep wondering what the real reason might be for a merger between Dish Network and T-Mobile. I mean, how the heck does that make any sense? Where is the synergy in that deal?

I can’t imagine what savings, what technological advancement, what marketing benefit there might be to such a combination.

I don’t see such a deal as anti-competitive. I just don’t see any business logic to it.

I would prefer it if these cellular companies would just focus on cellular – at least until they get it right.

Next time you drop a call on AT&T, just remember: You could have had ONE MILLION CELLULAR TOWERS for the same price as AT&T paid for Direct TV.


Spread the word:

  • Harder and harder to install cell towers due to zoning and no one wants one in their yard. They only have to be better than Sprint and T-Mobile in coverage. They don’t aim for great; they aim for good enough to hit their numbers. DTV brings OTT TV, eyeballs and much needed revenue

  • Balthazar_B

    Re. your question on Dish and T-Mo: Dish has at least 80MHz of spectrum but no network to deploy it. IIRC, T-Mo has about that much AND an operational network but they’re far behind VzW and AT&T in spectrum holdings. Conceivably, a Dish/T-Mo merger would enable the former’s spectrum to be put to use (but they’ve got to use much of it within two years or lose the licenses). That’s where the synergy in THAT potential relationship comes from.

Telecom in Your Inbox

About this Post


Colin Berkshire is a highly technical HR executive in the Pulp and Paper Industry. Colin has an engineering and voice background, and is currently on assignment in Asia. NOTE: Colin does not respond to comments, and does not Tweet.