Why the AT&T and T-Mobile Merger Is Bad For Consumers 367
adeelarshad82 writes "AT&T recently announced that it will buy T-Mobile for $39 billion. If the transaction gets approved by the government and closes in a year as planned, it will create the nation's largest wireless carrier by far. While this is great news for both companies, analysts believe that it's an awful idea for end consumers for a number of different reasons — from obvious ones, like a rise in rates due to lower competition, to subtler ones, like more selective phone choices for consumers."
Reject (Score:2)
The FCC has been approving way too many mergers lately. Sirius and XM (okay). Comcast and NBC (bad). ATT and T-mobile should be negated.
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P.S.
"AT&T's 700 Mhz spectrum" came from the selloff of TV channels 52 through 69. ATT, Verizon, and the FCC are pushing to selloff channels 25 and up, too, effectively killing free television (there would be one-half as many stations).
Re:Reject (Score:5, Informative)
This would be one of the reasons why the DTV transition [wikipedia.org] is happening world-wide, so governments can reassign the spectrum for other uses.
In the US [wikipedia.org], low power stations are still allowed to transmit, but they know they are on borrowed time, as the international date to end analog television signals is June 17, 2015.
Re:Reject (Score:5, Informative)
It's ultimately not the FCC, but rather, the DOJ that would have to step in and stop it. So write them [justice.gov].
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I would argue that AT&T has already abused their near-monopoly position in ways that violate anti-trust laws, and that the whole purpose of the DOJ's trust busting is to prevent mergers and combinations that would result in increased violations of those laws.
Re:Reject (Score:5, Interesting)
This does violate the Sherman Antitrust Act.
Why do you say having only one GSM carrier in the entire country wouldn't result in less or no competition?
GSM is the only network wherein your Iphone can talk and use data at the same time.
I for one am against any more consolidation among huge companies. We have had it in banks, supermarkets, phone companies, we don't need any more. Do you want there to be only one or two banks, one or two wireless carriers, one or two supermarkets, and that's it? If you don't like it you can just not buy any. I want more competition, not less. More companies duking it out so I have choice.
These wireless companies have spectrum licenses. They don't own those frequencies, they get to use them in the public interest.
Remember when AT&T bought Cingular? They sold off the old AT&T network and frequencies to Tmobile. They kept the better performing Cingular Wireless network. Why did they do that? They had to. The Justice Department wouldn't let them buy their competition unless they divested those assets. That's fair. MORE competition, not less.
AT&T and the baby bells were all separated out years ago in the AT&T Divestiture. Now, Pacbell turned into SBC which bought Bellsouth and others and finally bought their former parent AT&T, and whopee, they are all back together. It was a 25 year plan, they planned it all, the crooks.
Now they want to take away more customer choice.
Just say no. No to companies buying their competition. No to consolidations that limit competition. Especially where these companies have government licenses. It's just not right.
Its a done deal (Score:5, Interesting)
They haven't denied any of the other mergers that became the current AT&T.
They didn't deny SBC when they wanted to offer long distance service either.
They're not going to deny this either.
I'm rather surprised they didn't buy Comcast.
But of course, they might try it even before this deal completes.
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That'd be silly, considering AT&T Created the Comcast we know today [usatoday.com] by selling them AT&T Broadband in 2001. What kind of business would buy back a business they'd already spun off [pcworld.com]...
oh.
Re:Its a done deal (Score:5, Informative)
Not that the net effect isn't essentially the same, but the path was not how you described it.
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1997, when SBC tried to buy AT&T.
Said merger was approved when they tried it again in 2005, which formed the company now known as at&t.
Time for DISH and DIRECTV to join the fun? (Score:2)
Time for DISH and DIRECTV to join the fun?
The one good thing that may come from that is the room for all HD channels with ALL THE EAST / WEST FEEDS.
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It's ideal for TV. Much less bandwidth limitation than people think. 1000 channels on DirecTV, some of them on-demand, 3-D, 1080p, or interactive gaming. I only use my local cable company as an ISP any more.
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It's either that or dialup, in some parts of the USA.
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N F L Ticket.
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And then Taco Bell buys all the other service-specific corporations.
$39 BILLION!? (Score:5, Insightful)
Where was that $39 billion when it came to putting up and maintaining signal towers? Where was that $39 billion when it came to customer service? Where was that $39 billion when it came to the outlandishly expensive service?
All this money, and what does AT&T do with it? It's like a slap in the face for their own customers.
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Where was that $39 billion when it came to putting up and maintaining signal towers? Where was that $39 billion when it came to customer service? Where was that $39 billion when it came to the outlandishly expensive service?
All this money, and what does AT&T do with it? It's like a slap in the face for their own customers.
Though I agree, I can't help but think about this one detail: Wouldn't they suddenly have all of TMobile's already-installed hardware?
Re:$39 BILLION!? (Score:4, Insightful)
They will suddenly have to maintain all of T-Mobile's hardware, but it won't do them that much good. AT&T's 3G and T-Mobile's 3G use different bands, and the vast majority of phones don't have the hardware to support both. At best, they could offload a little bit of 2G voice and EDGE traffic.
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If that were true then they could just issue a firmware update to support different frequencies in different regions and carriers, yet this never happens even on handsets not sold via a carrier.
YAY FIVE MINUTE DELAY, GO SLASHDOT!
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Phones have antennas that are tuned to specific frequency ranges. It's not as easy as a firmware flash.
Hardware Filters (Score:4, Informative)
That's not quite the case - a lot of the radios have hardware filters that can't be removed very easily - you'd be looking at desoldering surface-mount components and then replacing them with other versions...and then recertifying the entire thing to make sure you can still transmit without breaking FCC regulations (at least in the States.)
The OpenMoko FreeRunner came in two versions - 900/1800/1900, and 850/1800/1900. It is not possible to change frequencies, and almost the entire phone is open to modification by the user.
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Re:$39 BILLION!? (Score:4, Informative)
That's why a bunch of people think this merger happened. Supposedly it's about a 5-year process to get a new cell site approved by the FCC. (e.g. it's not about money, it's about paperwork delay).
The problem is: T-Mobile's 3G sites are all in the 1700 MHz band. No AT&T handset supports UMTS1700 to my knowledge, so AT&T phones won't be able to use the new tower assets for 3G. A cell site approval from the FCC is not based just on siting - it's licensed for a specific frequency and power level. So the T-Mo tower assets can't just be switched over to a different band.
There is a *slight* possibility it may be easier for AT&T to get an STA to change a tower to a new band than to build a new site though.
As to the negative effect this will have on equipment manufacturers (handset and network infrastructure) - Anyone claiming this will have a significant negative impact on those people is forgetting that there are more countries on this planet than the United States.
In terms of handsets - AT&T has already been in a situation of using bands not supported by any other carrier anywhere else in the world. Any phones for them had to be specially customized for them. Now, quad-band GSM has been common for a long time, but I have yet to see a UMTS handset that supported both the world frequencies and all of the US frequencies. T-Mobile was slightly fortunate in that unlike UMTS1900/UMTS850, some other countries did use UMTS1700. As a result, manufacturers could target more markets with a handset that supported UMTS1700/2100 than one that supported UMTS2100+the AT&T bands.
For network equipment providers - nothing changes. Previously you had equipment for AT&T and equipment for the rest of the world, this doesn't change. AT&T is still at a disadvantage of lacking the economies of scale the rest of the world can take advantage of.
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Re:$39 BILLION!? (Score:4, Insightful)
Re:$39 BILLION!? (Score:5, Interesting)
Corporations aren't evil. They're amoral. There's a subtle difference.
Re:$39 BILLION!? (Score:5, Insightful)
The company is amoral. The management are evil.
Re:$39 BILLION!? (Score:5, Interesting)
They are amoral, but allow evil deeds to flourish because the people doing the deeds know they will never be held accountable. Lack of personal accountability is the REAL evil of the corporations.
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Re:$39 BILLION!? (Score:4, Insightful)
Or as the wonderful Canadian documentary The Corporation [thecorporation.com] pointed out, if a corporation is legally a person, then it is a sociopathic person. It's not that they're actively trying to do bad things, it's just that they don't care if they do evil, so long as it benefits them.
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Re:$39 BILLION!? (Score:4, Interesting)
If you couldn't go to prison for crimes, wouldn't you do things a wee bit differently? ;-)
No. I wouldn't. I'm not a sociopath. I don't refrain from doing evil because of a fear of punishment. I refrain from doing evil because I have empathy, and because of that, hurting others hurts me directly. It may also harm me indirectly, as people who have been hurt often lash out irrationally, and people whose choices have been constrained often make choices that harm others, potentially including me. Enlightened self interest looks a lot like selflessness .
Re:$39 BILLION!? (Score:4, Interesting)
If you couldn't go to prison for crimes, wouldn't you do things a wee bit differently? ;-)
No. I wouldn't. I'm not a sociopath. I don't refrain from doing evil because of a fear of punishment. I refrain from doing evil because I have empathy, and because of that, hurting others hurts me directly.
I don't do evil things to people that i consider good because of empathy.
I don't do evil things to people that i consider evil but who honestly think they're doing good because of morality.
I don't do evil things to clearly evil people (people who do evil and don't give a fuck as long as it benefits them in some way) because of the law, ie fear of punishment.
If that means i'm not as civilized as i ought to be, oh well. Not that it makes a big difference practically speaking, since barring the collapse of civilization i'll behave the same in all circumstances anyways.
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You don't think that there would have been more iPhones sold if the data coverage had been more than a Starbucks in Chelsea?
A loan from JP Morgan (Score:4, Informative)
A loan from JP Morgan
http://www.reddit.com/r/AskReddit/comments/g7vzu/why_the_hell_does_att_have_25_billion_in_cash/
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Don't forget that the caps they just put on DSL and their higher speed service. If this gets approved then we know that without a doubt that the Telco now own the government.
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Where was that $39 billion when it came to putting up and maintaining signal towers? Where was that $39 billion when it came to customer service? Where was that $39 billion when it came to the outlandishly expensive service?
All this money, and what does AT&T do with it? It's like a slap in the face for their own customers.
Even though a lot of people like to pretend they are forced to do business with AT&T, they aren't. I live in a dead spot on their network, so I don't use them. It wasn't difficult.
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Re:$39 BILLION!? (Score:5, Interesting)
Even though a lot of people like to pretend they are forced to do business with AT&T, they aren't.
Except when they buy the provider you went with to avoid going with AT&T.
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Silly boy. It's cheaper and more effective to spend $100 million on an ad campaign telling people how much better coverage is than spending $1 billion to make it actually better.
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I do not care about the t-mobile thing because I never considered T-Mobile as a viable competitor. For the most part there are two main level competitors, ATT and Verizon. The choice depends on the service level and use. This will not be effected. Below these two was basically Sprin
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(outlandishly expensive service) + (Apple worshipers) = $$$$$$$$$$
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Since MOST of that $39 billion is in shares, I don't think you can use shares to pay for towers
But its good for Verizon and others (Score:4, Interesting)
It is certainly bad for customers.
But its good for Verizon and others, because there are a lot of T-Mobile who are: "Anybody but AT&T".
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Not nearly enough of them to make a difference, in my opinion.
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We can hope, altho it's damning Verizon with faint praise. It becomes a GSM monopoly, further pushing Verizon out on an EDGE (pun intended) with LTE.
The duopoly that results (sorry, Sprint and Clearwire are dying) means that we'll have the fun of the Canadians, who deal with the Rogers- Bell Canada Conundrum. Tweedle-dee and Tweedle-dum.
What we really need is a technology to become the successor to GSM, CDMA, and LTE. Call it, 5G. We could bribe the ITU to lower the speed floor, and use visible light modula
Don't Like (Score:2)
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Even though your phone is unlocked there's not really all that much you can do with it. AT&T use frequencies that are different from pretty much every other provider in the world so if you're with them you're still locked in, if you're not you can't switch to them (without a new phone). The only other large supplier are T-Mobile who use more sane frequencies. This allows you to switch to other providers around the world, but that's not much use unless you travel. An unlocked phone in the states only rea
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Deregulation (Score:5, Informative)
This is where old Ma Bell ended up. [imgur.com]
Colbert is going to have to update his take on AT&T [ebaumsworld.com]
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Wow...just...wow. That first image is like a microcosm of our country's changed views on the market place. Reminds me of a matching graph from Discrete Math II.
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It's not at all surprising that the former monopolists are the new monopolists. The inability to act in accordance with the spirit of the law is a mental disease.
What competition? (Score:5, Insightful)
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All the more reason to fight for everything we possibly can.
Re:What competition? (Score:5, Informative)
This is the nature of all markets: the big ones buy up the smaller ones until there are only one or two big ones left. Occasionally they collapse and are replaced by others, but the diversity never really expands.
Deregulation and competition just doesn't work in the real world.
Re:What competition? (Score:4, Insightful)
You're overstating your case a bit.
Some markets do lend themselves to consolidation like this. If you were a hypothetical omnipotent and benevolent Grand Pooh-bah of the cell phone market right now, you could cut costs of cell service significantly by reducing things to a single carrier, and then sell the service at cost. But instead, we have profit-driven corporations, who want to cut the costs but keep the prices at their current higher (and thus inefficient) price.
Other markets don't consolidate as easily, which is why, say, plumbers aren't all working for a handful of big conglomerates.
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I know that moderators have a soft spot for cynical comments, but I disagree. I think there IS competition in the US mobile market. This merger, however, will be another big blow to it, as T-Mobile has recently been an innovator in the space. T-Mobile brought European-style contract-free plans to the US, encouraging the use of unlocked phones. It also was the most vocal and earliest adopter of Android.
What the US mobile competition has shown me over the years is that consumers are not solely concerned w
Faster move to 4G (Score:2)
Even worse possibilities on the Horizon... (Score:2)
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I would think that Verizon might at least wait to purchase Sprint because Sprint is trying to make a-go with WiMAX rather than LTE for their 4G technology. I also don't think Sprint has much to offer Verizon in terms of gained voice/data coverage with respect to 2G and 3G.
At least with respect to T-Mobile and AT&T, T-Mobile will bring a lot of infrastructure that AT&T wants (towers) because of the inherent weaknesses with GSM in populated areas. This should increase voice quality as well as help to
Great news for both companies? (Score:5, Interesting)
AT&T shareholders just watched their management pay way too much for T-mobile. T-mobile and AT&T employees are both now extremely fearful for their jobs, as there is almost 100% overlap in most markets in everything but customer service call centers. This goes all the way up the management chains.
This is less like "joining forces" than conquering your neighbor by buying his mortgage from the bank for double the house's value, then throwing him and his kids and your wife out on the street.
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But at least I upgrade from my boring old wife to his MILFtacular one. Everyone wins!
There's a reason I left AT&T. (Score:2)
I had AT&T years ago; could never get a signal inside my house. I finally switched to T-Mobile; no problem getting a signal inside my house.
If I want GSM (so that my phone will work in the rest of the world when I travel (right?)) then I either have to have AT&T, T-Mobile, or one of the MVNOs that operate on their networks. I fear if AT&T dismantles the T-Mobile infrastructure that I'll be back to not getting any signal inside my house. Is my fear justified?
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Misleading story (Score:2, Insightful)
Anyone reading this story might think that AT&T had bought T-Mobile, rather than just one of their operating companies in a foreign country a long, long way from their home market.
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Misleading comment.
/. News Network (Score:2)
A company practicing what amounts to price fixing pays the government to ignore the fact it will become even more of a monopoly is our top story tonight. This story and more at 11.
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A company practicing what amounts to price fixing pays the government to ignore the fact it will become even more of a monopoly is our top story tonight. This story and more at 11.
Monopoly... I do not think that word means what you think it means.
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If company A and company B (and Company C, etc) produce the same product with the same quality for the same price, and any changes are mirrored immediately, as if they planned it out beforehand, they are de facto a price fixing consortium, a type of monopoly.
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You are claiming that there are no practical difference between the four major carriers, and that they are engaged in illegal price fixing?
Backwater, ho! (Score:3)
The USA is already a backwater for GSM service. I pay too much for AT&T, there is no competition on price or features, and now what little pathetic choice I have will be taken away. I don't want crappy proprietary technology, I want to be able to use real mobile phones that I can take with me anywhere in the world. Barring Japan and Korea, for some reason.
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If your handset works on HSPA+ (AT&T and T-Mobile's "4G") using the European bands, you can get full 3.5G service on both Softbank and NTT Docomo in Japan. I bet you can in Korea as well.
Suffice it to say, the US is virtually alone in being the fractured mobile backwater, as even in those Asian countries you can get good service.
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I used to pass 7 different supermarkets on the way home from work.
Now I pass 5 stores with only 2 names on them. And they both carry the same crap off the same boat from Chile.
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How about asking why there are only four major carriers and why the smaller ones never get big?
Everyone's griping about AT&T (which I do as well) but no one wants to focus on what the real problem is. AT&T's problems are due to not being able to get enough bandwidth and towers to support their customers. People gripe about this even with the other carriers. (Honestly in my area AT&T is much better than Verizon). Simultaneously most people want not just local coverage but national coverage.
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"Healthy" players?
Both Sprint and T-Mobile have been losing subscribers by the bucketloads (only last quarter did Sprint finally turn the corner). The balance sheets of both companies bleed red ink. Sprint's story is especially tragic: they completely bungled the NEXTEL merger, which should have guaranteed them "second place" status. Sprint's heavy investment in WiMAX (via Clear) may only be a long-term win IF the equipment they purchased can be rolled into an LTE deployment as easily as it has been clai
Tracfone (Score:2)
This affects more than the customers (Score:2)
This also bodes well for those in the seciton of the Venn diagram who both hate unions [redstate.com] and think that AT&T sucks [facebook.com]. They have a brand new outlet to scream about how lazy union workers are responsible for AT&T's sucky network and poor customer service and are going to ruin the T Mobile experience.
Led Zepplin (Score:5, Informative)
Go to the T-Mobile forum if you want to know how well this is flying with T-Mobile customers. [t-mobile.com]
The subject should give you an indication.
I explicitly chose NOT to have anything to do with AT&T and now I am forced into it. Does that sound like free capitalism to you??
Re:Led Zepplin (Score:4, Insightful)
Does that sound like free capitalism to you??
Yes. Capital is free; you are not.
Social relations are replaced by market relations so instead of each person having equal freedom intrinsic in his existence, money itself becomes a measure of the decisions a person is able to make. They've got billions of dollars and you probably have only a few thousand.
This is the meaning of freedom created by the marketplace.
Any chance for public input? (Score:2)
How do these acquisitions typically work? At any point, is there a chance for the public to register the concerns with the regulatory bodies?
I signed up with T-Mobile at the end of last year when I bought a Nexus S. T-Mobile has been great and I love that I can tether my laptop to my phone (or create a wifi hotspot) without having to pay an extra fee. AT&T is notorious for not allowing this and for having ridiculously low caps and I'm worried that once AT&T takes over, I'm going to lose this capabil
Many T-Mobile 3G phones will end up bricked (Score:3)
Because apparently AT&T wants to repurpose T-Mobile's 3G spectrum for 4G. Source: AP via Y! news [yahoo.com].
No one looks at the real problem... (Score:2, Insightful)
Let's see. Everyone yells at AT&T because they can't provide the coverage and bandwidth iPhone users need. AT&T tries to install more towers but ridiculous levels of regulation and red tape either limit their ability or make it take such a long time it's the same thing. AT&T sees a competitor with towers who is losing money and wants to sell. AT&T buys said competitor as the only way to provide the support customers demand.
Customers immediately become furious with AT&T rather than the
But T-Mobile was the *good* GSM service in the US! (Score:2)
I've had both AT&T and T-Mobile in the Washington DC area. T-Mobile had less areal coverage, but when your phone had minimal signal, it typically kept it and didn't drop your call. AT&T has more bars in more places, but using those bars to make a phone call is always a crap shoot - you can have what looks like a strong signal and get kicked off anyway, or be unable to connect at all.
Much of this experience was before the iPhone - AT&T just got worse after that.
Crap!! Lord Vader has caught up with me at last!!! (Score:3)
Even back when iPhones were the only real smartphone in town, I held off because I didn't ever want to to business with AT&T again. The reason I resisted the Apple siren song was because AT&T service sucks, and they have no respect whatsoever for customers.
I was glad I had when the Nexus One came along, because I think it's better than an iPhone anyway, of course. I've also been very happy with T-Mobile's service. Now I see the Death Star approaching, and I know my happy little world is probably doomed.
Finally a quality GSM network in the US (Score:3)
With this merger, we should finally have quality GSM coverage in the United States. I will bemoan the superior T-mobile customer service, but I had to switch from T-Mobile to AT&T when I lived on the Pacific coast for coverage. The fact is that there isn't really room in the US for two GSM carriers.
For those who think AT&T could have just expanded its coverage, go look into the issues every carrier is facing in San Francisco where new towers face "OMG - the Radiation!" from the residents. Buying T-mobile was the best realistic way to expand coverage.
AT&T reminds me of Terminator 2 (Score:4, Funny)
Where's a vat of molten steel when you need it?
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This will probably push me to a second tier carrier like Metro PCS.
T-mobile has always been customer friendly to me, and their rates are the best. They even let me save by not getting a contract and buying my phones.
Additionally I like their broadband policy the most (5gb month, then throttled, as advertised, no overage fees).
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It totally sucks. My bill will go up about 30% and the Nexus S I bought JUST LAST WEEK will apparently be useless:
http://www.msnbc.msn.com/id/42195939/ns/business-us_business/ [msn.com]
Not only that, I can't switch to any other provider with my phone because nobody else in the US is GSM.
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As an AT&T customer that specifically chose AT&T over T-Mobile and Verizon (I was leaving Verizon due to terrible customer service and Sprint was not in my area at the time), I feel like it's worth reminding people that the service is largely dependent on your area and that as a re
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Agreed. This has shown that the entire notion of "voting with your wallet" is worthless, as the entity you are voting against can simply buy up the company you went with anyway.
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There is. The problem is that just because they CAN do something, doesn't mean that they WILL. AT&T has powerful lobbyists. There is also (unfortunately, in this case) a powerful anti-government movement in this country right now. They would prefer to let companies (especially large ones) do what they want.