Two meaty telecoms stories circulating at the moment. First, AT&T's reported $39B deal for T-Mobile USA came out of the left field yesterday at a time when many observers (myself included) were wondering whether Sprint/ T-Mobile was a runner. Provided it gets SEC clearance, the deal is dynamite for AT&T, but the really interesting question is "what is DT going to do with $39B?" As with Vodafone's recent strategy of cashing in minority investments, I find myself rather stumped by the strategy in play. Should we expect a massive share buy back or a mad spending spree in emerging markets? Or is this the first move in a strategy of massive consolidation into global super-majors - could Teliasonera, KPN or Teliasonera find themselves the subject of merger talk? Looks like a fascinating year is in store for the mobile industry.
Nowhere more so than in the UK, where Ofcom has unveiled the rules for the forthcoming auction of 800 and 2600 spectrum, suitable for LTE. As ever with Ofcom, the process is complex and based on a curious view that consumer interest is best served by a larger number of crippled networks operating on barebones spectrum.
Personally, I believe that a better option would have been to offer three spectrum lots and enable the operators to fight it out. Four networks is too many for the UK and has led to irrational competition based on marketing and pricing, rather than network quality. Having recently come back from Norway, with its nice wide bands and low population density I now appreciate why some competition is good, but too much is terrible.
Oh, and while they were at it, Ofcom should have widened the amount of spectrum available by taking a couple of channels out of the UK's bloated DTT spectrum portfolio. Get them to switch to MPEG-4 on all multiplexes and the need for all those radio channels goes away. Or, if you want to be market led, get them to re-bid against the MNOs and see whether they're as keen on showing ITV2+1. Simples.