Analysis of the
Media's Use of Techniques in Public Persuasion

A Media Awareness Project

Archive

A Closer Look at the AT&T and T-MOBILE Merger

Posted by Roar of the Bewildered Herd on March 27, 2011 at 7:57 PM

Is the $39 billion dollar merger between telecommunication giants AT&T and T-Mobile just being done to support the world's most valuable company, Apple Inc.?

 

Let’s go back to 2007, the beginning of the smart phone revolution. Apple releases the iPhone and signs an exclusive deal with AT&T as its exclusive wireless provider, making the Apple-AT&T deal a closed-sourced business model. Which plainly means that if you use their phone, you can only use their applications that only work on their choice Network.

 

Shortly after, Google released the Android and chose to use Verizon as its main wireless provider. However, Google chooses to support an open-sourced business model, meaning that the Android operating system can be used with other providers such as Sprint and T-Mobile.  It also means that if you use their phones, you can use 3rd party applications on their phones. This begins the war between Google's open-sourced business model and Apple's closed-sourced model.

 

Meanwhile, a year prior to the start of the wireless connectivity war, Rene Obermann, the CEO of T-Mobile, becomes CEO of T-Mobile's German parent company Deutsche Telecom. Late in 2007, Apple breaks its own business model when it strikes a deal with T-Mobile allowing the iPhone to be used on Germany's T-Mobile network.  Why this was done at the time, no one fully understood. Jump ahead three years to June 2010.  Apple is in negotiations to allow the iPhone to be used on T-Mobile's network in the United States, confusing some because Verizon is the larger network. In September 2010, USA Today wrote that Apple is the second largest company in the world behind EXXON.  In October 2010, the Huffington Post wrote that Apple's stock must rise 12% above the then current stock price of $282.52 cents in order to become the largest company in the world.  As of today, March 28, 2010, Apple's stock sells for $351.54, down from $364.90 last week, making it the most valuable and largest company in the world. On March 20, 2010, AT&T's acquisition of T-Mobile USA for $39 billion dollars is announced.

 

Let’s go back again to 2007.  A deal is made between Steve Jobs and Ex-CEO of T-Mobile, Rene Obermann, which allowed the iPhone to be used on T-Mobile's German network, breaking the exclusivity deal between Apple and AT&T. Three years later, Rene Obermann sells T-Mobile USA to AT&T. Now, let's go back to the open-sourced, closed-sourced business models. It seemed that Apple was slowly adopting the Google mentality of open-sourced ideas. However, it is now clear that a more strategic agenda was being worked out over the past few years involving Steve Jobs of Apple, Rene Obermann of T-Mobile and AT&T.  Will the closed-source business model rule when all is said and done? Will the fight to keep an open-source for wireless connectivity continue or is this the end?

 

It is now in the hands of the FCC whether or not the deal goes through. Is this the reason the FCC ruled to exempt wireless providers from the "unreasonable discrimination" clause back in December 2010? Shall we be so bold as to connect the decision to place Julius Genachowski as head of the FCC by President Obama just so Obama can somehow payback and support big business telecommunication lobbyists? Is this a repeat of the 1996 Telecommunications Act ... where big media conglomerates hijacked the telecommunications industry? Is President Obama pro-big business or really trying to regulate financial institutions as he has promised? Is the current trend of financial institution's dominance in politics becoming more transparent? Are we, the Bewildered Herd barking up the wrong tree? The Bewildered Herd will continue to Roar. 

Categories: Network Neutrality

Post a Comment

Oops!

Oops, you forgot something.

Oops!

The words you entered did not match the given text. Please try again.

Already a member? Sign In

6 Comments

Reply William Cook
5:47 PM on June 19, 2011 
This trend is very scary. Fewer and fewer companies are taking control of the way that we think and of our purchasing power. We need as consumers to be aware of this and gather as much information as we can.
Reply Rachelglez
8:15 PM on June 22, 2011 
Your are so right, I think that all this information should be out there in the streets like advertisement is so the public can get informed. It is funny because I bought my Iphone at AT&T and now I actually learn this.
Reply BarakLynn
2:17 PM on June 23, 2011 
Soon enough the the technological world will be run by one or two giant comapnies. This means that they will have control of electronic utilities and of course their prices and areas to which they want to sell their product.
Reply valverde
11:29 PM on June 24, 2011 
Its amazing how the mergers of two major cellular companies AT&T and T-Mobile are causing consipiracy theories of a monopoly of mass communication. In 2005 AT&T bought out Cingular and about two or three years ago Sprint bought out Nextel. We can only imagine whats next maybe it's all a strategic approach to creating a legal monopoly. Ironocally in the near future the federal government will be bailing them out of another recession and become silent partners of the massive communication empire.
Reply Brian Ramos
11:49 PM on June 24, 2011 
Its simply business, I understand that these companies are taking more and more control of the market, however, these companies are simply looking from a business perspective. At the end, money talks an these companies are simply fighting the competition. If the worst happenss, the government will most likely intervene and introduce a law to prevent these companies from violating rights. It happened with the the robber barons during the 19th century, where the government introduced no monopoly. If these companies attempt anything against the citizens, our government will intervene.
Reply Roar of the Bewildered Herd
12:27 PM on July 6, 2011 
This trend that you are speaking of began in the late 1980's. Over fifty corporations controlled over eighty five percent of all the information that you read in newspapers, heard on radio stations and watched on television. Thanks to the telecommunications act of 1996, today less then six media conglomerates control over ninety percent of all the information you read, hear and watch. How long before that number is dwindled down to one corporation owning one hundred percent of the information? This issue is not spoken of in main stream media, for obvious reasons, so it is everyone's responsibility to inform themselves and spread the word with this on going issue. To quote Zack De la Rocha "We have to take the power back."