AT&T blames failed T-Mobile merger for higher prices

May 3, 2012
15
AT&T blames failed T-Mobile merger for higher prices

Randall Stephenson, chairman and CEO of AT&T, has blasted the government's decision to block the merger with T-Mobile USA. Speaking at a conference, Stephenson says that ultimately the decision will lead to higher prices for consumers, and that the current amount of spectrum available can’t sustain the number of competitors in the wireless industry.

Speaking at the Milken Institute global conference, he said: “We're running out of the airwaves that this traffic rides on. There is a shortage of this spectrum." He also gave figures which suggested that mobile usage would increase by 75% a year for at least five years. He went on to say that competitors would be forced to drop out due to a lack of available spectrum for LTE.

Stephenson believes that the “more competitors you have, the less efficient the allocation of spectrum will be.” He cited Europe and Asia as an example, saying that there were fewer carriers there and that spectrum was allocated more efficiently as a result. Stephenson also said that the reason AT&T began throttling unlimited data plans was due to the blocking of the T-Mobile merger, and that prices had gone up 30% as a result.

Customers might not have been too happy about the removal of unlimited data, but Stephenson says he would have imposed caps even sooner: “I wish we had moved quicker to change the pricing model to make sure the people who were using the bandwidth were paying for the bandwidth.”

[via The Wall Street Journal]


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