Dan Hesse’s White Room is closely guarded even within Sprint Nextel Corp. (NYSE:S) The chief executive officer carries the only key and draws black curtains over his scribblings before leaving. This is where Hesse retreats to map out “nukes” in red, blue and green ink, lately his tactics for stopping AT&T Inc.s proposed takeover of T-Mobile USA.
“Clearly, purely, we want to win and block the merger,” said Hesse, during an interview at the company’s Overland Park, Kansas headquarters. “This one poses real risks.”
Yes it does.
T-Mobile, for their part, has been spamming people with "free" text messages saying that "rates may have come down for you" - a come-on trying to get people who are expired on contract to come back in and renew. There's a problem with that though - the "reductions" are mostly about trading in your unlimited data plan for a capped one - something that all the carriers are attempting to force.
Slowly restrictions have increased on those plans. Years ago, when I first bought data access with T-Mobile they not only didn't care if you tethered they explicitly supported it. First on the Nokia 6610 (yes, I really had it on my account that far back) and then going forward on the first Windows Mobile phone T-Mobile offered - the MDA. In fact, "Internet Sharing" was part and parcel of their Windows Mobile offerings right up until Android displaced them.
Now of course it's frowned on by everyone - unless you pop for another $25. Never mind that a bit is a bit is a bit. Yes, you could (theoretically anyway) use more data on a laptop, but the difference is really quite theoretical these days with Youtube viewers and such built in to Android phones.
I'm not much of a video person, but being able to access things like my email over a SSL-encrypted link from multiple mailboxes (K9Mail), get into my trading accounts and such is quite nice, never mind general web browsing.
The problem is that as "cell service" moves far from "voice" and into data-centric services the load goes up and the revenue the companies want runs smack into what's reasonable. With MVNOs like Virgin Mobile sellling unlimited no contract for around $60/month that $100+ cell bill looks too damn expensive - and it is.
Sprint (S) has reason to be concerned. They tend to be a bit cheaper (although not much) but it's not hard to squeeze your competitor by the balls when you're a multiple of his size, you must compete for a scarce resource (frequency allocations) and part and parcel of what you sell is "access everywhere."
Let's face it folks - $100+ a month is more than $1,200 a year per person for what is now considered "standard" wireless services. Where the hell is the money going to come from to pay for all of this? Add in another $50-100 a month for cable TV and Internet and suddenly the common family of four is looking at somewhere around $3,000 or more a year in communication service charges!
That's a lot of freaking money!
I'm generally in the camp that consolidation in the wireless industry is bad, not good. I don't know what the solution is, frankly. Yes, I've seen alleged costs "come down" but is that real? Yes, we do much more with our service now than we did, but our bills are two, three or four times as high. Can we have the old service back at a fraction of that money? Yes, but that's not the question, I suspect - technological advances are supposed to result in deflation of prices over time.
Show me how this will benefit customers and I'd be interested in getting behind it. As it stands I think the customer is going to get screwed; I previously noted that the so-called "common technology" is utter and complete BS. I just got back from a 3,000 mile trip around the country (by car) and while I was able to roam onto AT&T's infrastructure in many places, all of them roamed using EDGE, because my nice UTMS T-Mobile phone is incapable of receiving and transmitting on the so-called "compatible technology" that AT&T uses due to band differences.
As such once this merger closes if you want high speed data AT&T will be able to force you off any grandfathered rate plan by killing the T-Mobile UMTS towers, thereby forcing you to pay their higher price.
I'm willing to bet they'll do exactly that, pretty much to the day the merger closes if it is allowed to move forward.