AT&T to buy T-Mobile USA making it top US wireless firm

AT&T says it will buy rival T-Mobile USA from Deutsche Telekom AG for $39bn (£24bn) making it the largest mobile phone company in the US.

The deal would give AT&T about 43% market share, putting it well ahead of industry leader Verizon Wireless.

T-Mobile customers will get access to AT&T's phone lineup, including the iPhone.

The deal would reduce competition in the US mobile phone industry and needs approval from regulators.

AT&T is looking to increase its network capacity to handle the rapidly increasing consumer demand for videos and data.
Regulatory approval

However, analysts said that the deal may prove controversial.

Consumer rights group Public Knowledge said that the deal would lead to "higher prices, fewer choices, less innovation".

The phone companies countered that the US market was competitive and call prices had declined in recent years as a result.

AT&T said regulators may ask it to sell some assets as a condition for approval.

It said it expects the deal to be completed in 12 months.

AT&T Chief Executive Randall Stephenson told reporters the company had done its 'homework' on the regulatory side of things.

"This is a unique opportunity. It's rare you have transactions where the synergies are greater than the price paid," Mr Stephenson said.
iPhone advantage

Mr Stephenson took over as chief executive in 2007.

The same year AT&T began selling Apple iPhones, and wireless data has since become one of its fastest growing services driving revenues up.

AT&T lost its exclusive rights to carry the iphone in US this year when Verizon Wireless began selling the data-device.

T-Mobile has reported falling earnings after missing out on the iPhone and failing to build a higher-speed wireless network.

The T-Mobile deal would be a way for AT&T to boost earnings by combining operations.

The company is estimating that it could generate savings of more than $40bn.

BBC News

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