AT&T + T-Mobile = competitive market?

AT&T's CEO, Randall L. Stephenson, dropping the ba... good news to analysts.

It actually equals about 130 million subscribers on one (or maybe 1.5) GSM network. AT&T is claiming that the transition will be a smooth and painless one for T-Mobile customers, but those of us who witnessed the Verizon/Altell merger know better... Essentially, many Altell customers were bullied into buying all new handsets and losing their Altell loyalty plans within the first year of the merger. I know this to be true as we were instructed to do this at the sales level.

I'm no stranger to marketing gimmicks, but if and when this whole merger goes through, it's estimated that Verizon Wireless and AT&T -- the nations two largest carriers -- will control around 70-80% of the cell phone market in the U.S. Coincidentally, these are also the only two carriers offering the iPhone... something that regional carriers are just going to have to continue to deal with. Also, keep in mind that Verizon and AT&T are the most expensive options for wireless service and have nearly identical price plan options.

In all my years in the wireless industry, I've failed to sway the opinions of thousands of loyal, T-Mobile customers. Many of these customers choose T-Mobile over other carriers as the price plans have always been significantly cheaper, they have a great catalog of handsets to choose from, and the customer service team takes care of them. Competitive T-Mobile plans save their customers a lot of money annually, and they are also one of the only carriers that will offer promotional pricing and bonus minutes. For example: right now you can get unlimited text and 4G internet with 1500 minutes for $79.99 per month. This is about $50 cheaper than the nearest Verizon and AT&T plan that offers similar features.

T-Mobile customers losing their plans is still speculation, but once AT&T has their talons into the 40 million people who have already chosen not to buy their service, what is to stop them from pulling the switch? While I love Verizon's coverage and caught the smart phone bug early on, I've personally witnessed them make a lot of terrible choices regarding pricing that generated substantial revenue for them while offering their customers few benefits. Do you remember 3G multimedia phones, and that useless 25mb plan that they required? A lot of people equated this to stealing $10 every month, and sure enough, this practice ended after about a year of constant customer complaints. AT&T has already pulled the plug on unlimited data plans for their own customers, and made a few questionable moves similar to the one I just mentioned, is this the door being opened up to T-Mobile customers?

Even if you think this merger is a great idea, think about the economic effects of this merger. When Verizon Wireless took over Altell, most of the Altell stores were closed, and many of the Altell employees were folded into to Verizon, resulting in a pretty substantial hiring freeze. Simply put, merging two companies eliminates jobs and it it eliminates stores. Is that the best option right now? Maybe AT&T can manage 130 million customers more efficiently than the two providers could separately, but I doubt anybody will see the benefits of this who doesn't work in upper management at AT&T. Furthermore, selling phones and plans to 40 million customers who are already paying somebody else isn't economic growth at all, no matter which way you look at it.

If I need to come right out and say it, I will. Eliminating another nationwide carrier is a terrible idea. Just because Verizon and AT&T are in fierce competition doesn't mean the market is competitive. If this goes through, we are basically being forced into an oligopoly that already seems guilty of collusion. And if you think this opens the door for a new carrier to emerge, just remember what happened to poor, little Helio.