When news breaks on Thanksgiving, you can safely bet that it’s bad news. AT&T’s announcement last week that it had withdrawn its application to acquire T-Mobile (and started preparing for the $4 billion payout it owes should the deal fail) is a great example. As we ate stuffing and turkey and cranberry sauce, AT&T was strategizing (all the football on TV probably helped). The plan, you ask?
Basically, AT&T is in talks with Leap (and presumably T-Mobile) to sell off a big chunk of T-Mobile’s customers and a small portion of its wireless spectrum to regional carrier Leap Wireless, according to the New York Times. The hope is that with fewer potential customers to be acquired in the deal, the Department of Justice may ease up in its campaign to block the merger. Even if the DoJ doesn’t back down, the exchange will give AT&T a stronger argument in the court room.
If it goes through, the AT&T/Leap deal would push Leap past T-Mobile as the number four carrier. The trick is to push over enough subscribers to make T-Mobile seem “smaller,” while leaving the pink carrier with enough wireless spectrum to help AT&T build out its next-gen service once it swallows T-Mo.
The plan is a long shot to say the least, but AT&T has quite a bit riding on this. $4 billion, to be exact.
For inspiration:
T-Mobile is a mobile telephone operator headquartered in Bonn, Germany. It is a subsidiary of Deutsche Telekom. T-Mobile has 101 million subscribers making it the worlds sixth largest mobile phone service provider globally.
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