In a new filing
with the Federal Communications Commission published on their MobilizeEverything site yesterday, wireless operator AT&T has spilled the beans on the reasons behind the intended acquisition of Deutsche Telekom’s T-Mobile USA business for a cool $39 billion. The filing also sheds some light on AT&T’s often criticized network performance. The primary reason to buy T-Mobile USA was an astounding rise in traffic blamed on data-hungry smartphones and tablets. It specifically mentions the iPad while alluding to the iPhone:
A smartphone generates 24 times the mobile data traffic of a conventional wireless phone, and the explosively popular iPad and similar tablet devices can generate traffic comparable to or even greater than a smartphone. AT&T’s mobile data volumes surged by a staggering 8,000% from 2007 to 2010, and as a result, AT&T faces network capacity constraints more severe than those of any other wireless provider.
The period between 2007 to 2010 when AT&T experienced an 8,000 percent rise in mobile data volumes likely refers to the iPhone, which debuted in the summer of 2007.
Unless AT&T buys another carrier that would improve their network capacity, its network won’t be able to accommodate the growing appetite of data-enabled smartphones and tablets because capital expenditures would be too high and the expansion would take too much time. Illustrating the point, the carrier wrote that data traffic on its network in the first five to seven weeks of 2015 is expected to match the whole of 2010. Consumers will benefit from the “reduced number of dropped and blocked calls, increasing data speeds, improving in-building coverage, and dramatically expanding deployment of next-generation mobile technology,” the filing reads.
Sprint is officially opposing the transaction and is demanding the government step in, arguing the acquisition would create a duopoly which would raise both the barrier to entry for other players and the prices users pay for wireless services.