AT&T breakup promises to boost T-Mobile’s wireless coverage

It’s the corporate equivalent of getting to keep the ring.

Following AT&T’s decision to give up its $39 billion bid for T-Mobile USA, T-Mobile parent company Deutsche Telekom confirmed this morning that it is walking away with $3 billion in cash from a break-up deal negotiated between the companies. Deutsche Telekom says it will use the cash to pay down its corporate debt.

However, the break-up also includes provisions that stand to benefit T-Mobile USA and its customers.

First, the Bellevue-based company will receive “a large package” of mobile spectrum in 128 markets across the country, including big markets such as Los Angeles, Dallas, Houston, Atlanta, Washington, Boston, San Francisco, Phoenix, San Diego, Denver, Baltimore and Seattle, according to a Deutsche Telekom statement this morning.

In addition, a new seven-year roaming agreement with AT&T will boost T-Mobile’s total population coverage from 230 million possible customers to 280 million, including some areas of the country where T-Mobile didn’t previously offer coverage.

Deutsche Telekom says the provision “will allow the company to improve its footprint significantly among the U.S. population and offer its customers better broadband coverage for mobile communications services in the future.”

AT&T ended its $39 billion bid to acquire T-Mobile USA yesterday after running into repeated regulatory roadblocks. The U.S. Justice Department in August sued to block the deal, saying that “AT&T’s elimination of T-Mobile as an independent, low-priced rival would remove a significant competitive force from the market.”

  • asok14215

    Does this mean that iPhones with T-Mobile SIMS can use 3G in the affected areas?