AT&T's buyout of T-Mobile won't mean much for smartphone users

The two carriers use the same network technology but not the same spectrum

Consumer advocates are upset (they always are) about AT&T's planned buyout of T-Mobile, announced Sunday, saying it will reduce choice and lead to higher costs. AT&T is spinning the acquisition as a way for it to become more efficient and to roll out next-generation 4G networks that much faster (they always say that).

In practice, the buyout will have little real effect, other than reducing the number of ads for cell phone service once (if) the deal passes regulatory hurdles. The acquisition makes a lot of sense at one technical level, given that AT&T and T-Mobile use the same basic cellular technology, GSM, for their networks. Earlier rumors of a Sprint/T-Mobile tie-up made little sense because they use incompatible network technologies (CDMA and GSM, respectively).

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You might think that the shared use of GSM means that AT&T can more easily expand its reach in areas where T-Mobile has better service than AT&T or help augment AT&T's overloaded networks in places like New York and San Francisco. But that's not necessarily the case and not immediately for smartphone and tablet users.

Although both carriers use GSM, they have different radio frequencies in the spectrum they license from the U.S. government. In practice, this means that voice calls can roam between AT&T and T-Mobile (which they already do), but not 3G data connections. Their phones work on each other's voice bands, but not each other's data bands. That's why you can't use an iPhone's data services on the T-Mobile network, even if you have a T-Mobile SIM card on an unlocked iPhone. Ditto for an iPad or any Android or BlackBerry models designed for AT&T's network.

Over time, AT&T could use T-Mobile's cellular infrastructure -- the towers and other antenna locations that T-Mobile owns or leases -- to add 3G and 4G data coverage to areas that T-Mobile serves better than AT&T. And it could increase its coverage density by upgrading the hardware in some of those locations, augmenting nearby AT&T infrastructure.

But that's a slow process, once that will take about a decade. The upgrade in hardware across the networks' infrastructure isn't likely to be much faster as a combined company than as two separate companies. After all, the total number of sites to upgrade will be pretty much the same either way.

Sure, there'll be some redundancy in fringe areas that can be dropped because neither carrier has enough traffic there to justify duplicate infrastructure. But both AT&T and T-Mobile have been challenged in providing enough capacity in urban and suburban areas, and those areas need better and/or more infrastructure, not less. The total number of customers is the same whether served by one or two carriers, so demand is unlikely to be any different.

T-Mobile's 1900MHz spectrum could be useful to AT&T as an overlay network for its LTE 4G network, which AT&T has just begun to roll out, separating the 4G spectrum from the often overcrowded 3G spectrum. (AT&T's regulatory fiings suggest it wants to do just that, but they're couched in the context of expanding rural wireless broadband, which has more to do with approval politics than anything else.) Other bloggers have suggested that is AT&T's LTE strategy, but it wouldn't be immediate even if AT&T does it.That's because there are already those T-Mobile customers using that spectrum, who would have to be moved to AT&T's spectrum from devices that may not work on AT&T's network. Still, the possibility leads me to advise you don't buy an LTE-capable smartphone from AT&T until you know it supports the 1900MHz spectrum; otherwise, you could be stuck in the 700MHz band with the 3G masses.

Under AT&T ownership, current T-Mobile customers will be able to buy iPhones, iPads, and other mobile devices not currently available on the T-Mobile network; they'll in effect be switching to AT&T. Perhaps AT&T will also make some of T-Mobile's exclusive smartphones -- but only those devices that work on both networks -- available to its current customers. There's no reason for AT&T to perpetuate the separate networks, and outside the iPhone and iPad, I can't think of any T-Mobile smartphones that don't have differently branded versions already available on the AT&T network.

If anything, T-Mobile customers will need to switch out their smartphones at some point to those that work on the AT&T network -- they would have had to do so anyhow as T-Mobile upgraded its own network. Now, the switchover cutoff might now come in five or six years rather than eight or nine, as AT&T pushes the T-Mobile customers to its primary network to reduce the management costs of the T-Mobile legacy network and achieve those efficiencies it's promised its shareholders.

This article, "AT&T's buyout of T-Mobile won't mean much for smartphone users," was originally published at Read more of Galen Gruman's Mobile Edge blog and follow the latest developments in mobile technology at Follow Galen's mobile musings on Twitter at MobileGalen. For the latest business technology news, follow on Twitter.

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