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AT&T and T-Mobile: Once to-be-allies now arch Rivals – VZ, DTE & PCS

Boston, MA 03/05/2013 (wallstreetpr) – AT&T Inc (NYSE:T) escalated its rivalry with T-mobile by targeting its network performance in newsprint ads. Ironically, there was a time when these companies were all set to forge a partnership with each other. AT&T went whole-hog and ran full-page counter-attacks in leading newspapers such as the Wall Street Journal, The New York Times and USA today, against unspecified claims made by T-Mobile. The ads state that the T-Mobile network speeds are only half that of those that AT&T Inc (NYSE:T) offers and that T-Mobile customers experience twice as many dropped calls. The flare-up between the two rival companies was ignited in January at the Consumer Electronics Show that was held in Las Vegas.

Rival network “crap”

It was here that John Legere the T-Mobile Chief Executive Officer called the AT&T Inc (NYSE:T), “crap” and he vowed that his company will take the industry by storm. On seeing the new AT&T ads, T-Mobile said that its aim had been accomplished and that its significantly larger competitor was sitting up and paying heed. CMO, Mike Sievert said that T-Mobile only gained from ads that AT&T printed. Verizon Communications Inc (NYSE:VZ) and AT&T Inc (NYSE:T) are the dominant players in the wireless markets and T-Mobile is considered to be an underdog at 4th place. The company that is owned by Deutsche Telekom AG (FRA:DTE) lost a total of 2.1 million subscribers last year, 515,000 of which were lost in the fourth quarter.

Head-on attack from both ends

The Dallas-based AT&T Inc (NYSE:T)’s spokesperson Mark Siegel said that the latest T-Mobile ads that touted that the geographic reach and the speed of its latest fourth-generation network are not only misguiding but are plain wrong. He added that the AT&T ads were no more than a friendly reminder that independent third-party testing had proved that the company had faster speeds and fewer dropped calls than T-Mobile. The former uses LTE, a speedier technology that helped a great deal in improving its reputation.

AT&T has planned on acquiring T-Mobile for $39 million but that plan had fizzled out after concerns were raised by U.S regulators about diminishing competition. AT&T Inc (NYSE:T) has since then being trying to piece-together smaller deals to improve their network capacity. In the meantime, September 2012 saw T-Mobile announcing plans of a merger with MetroPCS Communications Inc (NYSE:PCS). The war is nowhere close to an end.

Shares of AT&T Inc (NYSE:T) went up by 0.61% to close at $36.23

Shares of Verizon Communications Inc (NYSE:VZ) went up by 0.83% to close at $47.11

Shares of Deutsche Telekom AG (FRA:DTE) went up by 0.67% to close at $8.75

Shares of MetroPCS Communications Inc (NYSE:PCS) went up by 3.36% to close at $10.14

Published by Viraj Shah

Viraj Shah has done M.Com (Finance) and currently pursuing CFP. He is a technical analyst who tracks US markets along with other global markets like India very closely. He is very passionate about stocks and believes that money can always be made in market.

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