Sprint CEO Dan Hesse says AT&T, T-Mobile deal will ‘stifle innovation’

By on Mar 22, 2011 at 12:46 PM
CTIA March 22, 2011

Sprint CEO Dan Hesse on Tuesday shared strong opinions surrounding AT&T’s recent announcement that it plans to acquire T-Mobile USA from Europe’s Deutsche Telekom. Speaking on Tuesday morning at the CTIA Wireless 2011 convention, Hesse said AT&T’s plans to acquire T-Mobile will hurt customers. He also said that if approved by regulators, the deal would leave two big players — AT&T and Verizon Wireless — in control of 79% of the U.S. wireless market. “I do have concerns that it would stifle innovation and too much power would be in the hands of two,” Hesse said during a roundtable discussion. His comments were met with applause from the audience. Hesse added that Sprint will appeal to Congress in an effort to halt the merger. AT&T Mobility boss Ralph de la Vega defended the deal on Tuesday, saying it would address the spectrum shortage the U.S. is currently facing, and would bring mobile broadband service to more people. Verizon Wireless CEO Daniel Mead, who was in attendance at the roundtable discussion, seemed less concerned with the potential merger. “We’re observing what’s going on,” Mead noted. “We’re not going to get distracted by this.”

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  • Anonymous

    Dan Hesse is a fighter. Say it to their Face! . . . If I had a white grandfather… I would want him to be Dan Hesse

    • Getitwhileitzhot

      Awesome, lol

  • http://pulse.yahoo.com/_2BNOIBHBFICJEAPJLGHKK3WHPE DADDY WARBUCKS

    sore loser. he is mad that his CEO position is ending soon as his company will be bought out by verizon

    tick tock

    • Anonymous

      Honestly. You think VZW would take on the weight of Sprint? They honestly don’t need them. And frankly if At&t gets TMOB there is NO WAY the DOJ and FCC would let that slide… only 2 Major Carriers?

      • bababooey

        I dont think you can argue with Hesse’s take. Also agree with you that DOJ and FCC will allow it.

      • SKINNI

        I think Hesse is full of it. He has a point that it might be bad for the industry but exactly what would it have been if Sprint had finalized a deal with T-Mobile. They were working on that until AT&T came out of left field. So it wouldve been good for Sprint to get them but now its bad if its AT&T. Sounds like he’s just upset that he wont have the chance to run it all……

      • serpentor

        @SKINNI

        Sprint + Tmo = about 100 million subscribers, giving them parity with AT&T and VZW

        How do you think that would be a bad thing?

      • Anonymous

        @serpentor tmobile has 30 mill and sprint has 47 mill that come nowhere near 100 mill

      • serpentor

        Sprint + Tmo = about 84 million

        AT&T = 95.5 million

        VZW = 102.2 million

        I’d say a 10 million subscriber difference is closes enough.

      • CMC

        The DOJ and FCC seem to allow anything that comes across their desk. They have blocked anything in decades. It’s pretty much a rubber stamp.

      • Anonymous

        Even if DOJ/FTC/FCC move to block it, the GOP will defund them anyways. It’ll pass by shear momentum and incompetence by the defunded gov’t.

      • Nairb

        Joking surely? ATT will have to give up some current spectrum holdings to make this go through. Obama’s broadband mandate will see this go through. Just watch.

    • Anonymous

      Even though I do admire Dan Hesse, I do think this is sour grapes. But, if I was him, I would be pushing for more WiMAX expansion to more markets, and improvements to throughput, complaining to the government ain’t going to get you anywhere.

      • http://beenswank.net brandonmccall

        Sprint has plans to deploy LTE nationwide by 2013.

    • http://beenswank.net brandonmccall

      Shut up.

  • Anonymous

    There’s a good chance that the buyout will be rejected on the grounds of creating a GSM monopoly in the US. If it isn’t rejected, AT&T would have to make some major concessions which would mostly benefit anyone but Verizon. Sprint may very well be better off with this turn of events since a T-mobile/Sprint deal would’ve brought a GSM/EVDO network incompatibility headache of iDEN/EVDO proportions.

    • Anonymous

      Actually I doubt they would look at the technology, as in GSM or CDMA as a reason to reject the merger. It has to do with monopoly of service.

  • Mike

    sprint steam of event? link, any one.

  • serpentor

    How is it VZW was able to roll out LTE and AT&T couldn’t do it even with all the dough they were making off of iPhone?

    If Tmo was the only way AT&T could do LTE they had something really really valuable and it would have been worth it not to sell.

    • Me

      It’s all about spectrum. Verizon won big in the 700 MHz auction, leaving AT&T with a patchwork of 700 MHz and 1700 MHz, mostly in urban areas. T-Mobile has national 1700 MHz licenses, but no lower frequencies (700 or 850) that work well in rural areas or areas with large buildings. T-Mobile also has the least spectrum overall.

      Joining means that AT&T has national 1700 MHz licenses and extra 700 MHz in many areas to really create a robust LTE network. T-Mobile didn’t have any spectrum for LTE so it also benefits them from a spectrum point of view.

      Whether the merger is good for customers is another issue.

      • serpentor

        How can Tmo have no spectrum for LTE when AT&T is converting AWS for LTE?

        Couldn’t Tmo do the same?

      • Anonymous

        AT&T has plenty of spectrum it’s just leaving idle, as you’ve just pointed out with their purchases.

        It’s been pointed out many times @ dslreports.com that spectrum-crisis is fear-mongering manufactured by AT&T for its agenda.

    • Anonymous

      AT&T wasn’t in a situation where it had “all that dough they were making off the iPhone.”

      The AT&T iPhone subsidy was actually an enormous immediate, initial expense and cash outlay for the corporation for each iPhone that was purchased through AT&T.

    • Nairb

      You are a tard. ATT didnt need tmo for lte roll out. With the merger, they will use both 700 and NOW 1700 MHz. ATT was the second biggest bidder in the 700 auction, then they bought spectrum from Qualcom to bolster their holdings, now they will be using 1700, presumably in metro areas for capacity. This is all under the assumption the merger gets the green light. VZ launched with practically no devices supporting it. Call it a philosophical difference compared to att. ATT chose to wait until devices were/will be more plentiful.

  • http://twitter.com/whitmcghee Whit McGhee

    That’s a pretty gnarly zit he’s got just below his lip.

  • Anonymous

    Dans got a point…..

    Its not like At&t & TMobile give a shit about innovative phones. They only care when they see Sprint & VZW with them.

    • Nope12

      What?

  • Mustang08

    I have to agree with Dan Hesse. AT&T has made this move before. There use to be monopoly laws against this sort of thing. These laws were put into place just for this very reason. Dan, go after them with these laws.

    • Spooky842002

      Perhaps sprint should COMPETE in the market on their own and not use congress to compete for them.

    • Obisununome

      Monopoly laws are hard to prove just ask Bill Gates

  • scott

    sprint has had plenty of time to emerge but they havent because their products have not been as good as what you will find with VZW or ATT. and their network is not as robust.

  • Bo-Whobaby

    He said this right after he looked up the meaning of unlimited in the dictionary!

  • james

    people that say att does not care about innovative phones are so misguided. does anybody remember that little device called the iPhone!?

    • Bigbudha

      The iPhone was deal made with Cingular and apple not apple and AT&T,

      • Anonymous

        AT&T is just a renamed Cingular.

      • Tim242

        ATT is Cingular. Cingular bought ATT, then changed their name to ATT a year later.

    • Anonymous

      That phone was built totally by apple, AT&T had nothing to do with it. In fact, only a small number of AT&T employees were allowed to test the iphone on the network compared to the amount of engineers that test all other devices for AT&T.

  • http://www.facebook.com/people/Mike-Drake/1238774483 Mike Drake

    I don’t expect them to be happy about this, but I do expect a big player like Sprint to act the part and spend more time on a counter strategy than whining to the media. What’s stifled Sprint’s innovation thus far? Consumers put Sprint in the number three seat, not AT&T or Verizon.

  • Mb0719

    Funny how sprint picked up nextel in a similar fashion. Sprint offered last week to buy tmobile and AT&T offered more money and spectrum for tmobile and now he wants to call it a “monopoly” lmaoo, loser. BTW the customers made you number 3 in the U.S. Stop crying about it. You will be the only one with unlimited everything for cheap. that’s a good start!!!

    • Tim242

      A merger between #3 and #4 would not create a monopoly or duopoly. There would be 3 big players.

  • http://twitter.com/endlessct9a John C.

    Not quite sure what he means by “innovation.”

    In terms of handsets? Nope. The US isn’t the only mobile market in the world so makers will continue to create the goods.

    Network / network technology? The US is already way behind what’s available in Asia & Europe. With that being said, the US is a whole lot more real estate to cover in building newer infrastructure. So it’s going to take time no matter what.

    Pricing innovation? The US is half ass backwards compared to the rest but that’s not going to change as long as carriers can continue to fleece / nickel & dime us for every single thing.

    So what innovation is he referring to? Innovation to stay afloat while competitors leave you in the dust?

    • http://twitter.com/endlessct9a John C.

      The problem with Sprint is that they pursued pricing innovation from the get-go. Always about being cheapest, bringing the best value, etc. (Same problem T-Mobile had… and look what happened. Couldn’t sustain their business in the US market, so they had to sell off to AT&T). Wrong strategy. Pricing innovation can only get you so far in building subscribers. What is a carrier to do when they have revenue shortfalls because their ARPU isn’t high enough to actually sustain a business? What is a carrier to do when there isn’t enough capital / cash flow to continue building out the network? But of course, if you try to jack up prices in the hopes of improving the business service, etc., people will bitch / moan / complain and leave you for another. Double edged sword.

      Sprint should have always been about product innovation. New, innovative features. New, cutting edge phones. Best network coverage. Best data speeds. Etc, etc, etc.

      Can’t say, though, that any US carrier has done a thorough job in this regard. The way the US mobile industry’s economics works stifles it.

    • Anonymous

      Exactly, CDMA and innovation is an oxymoron. Sure some nice phones, good deals. But its the retard of mobile technology.

  • Anonymous

    RE: “…I do have concerns that it would stifle innovation and too much power would be in the hands of two….

    REPLY: AT&T [through Cingular] is the one that brought “innovation” to the public when it agreed to support the Apple iPhone, when the other carriers, including Sprint, refused to support it or wanted to force Apple to use the carrier’s cumbersome services and software.

    • serpentor

      Who said Sprint ever had a chance to turn down iPhone?

      I doubt they were ever in contention to be the first to get it.

      • Anonymous

        The surprise about the initial Apple iPhone carrier is that Apple chose Cingular as its sole U.S. carrier, instead of Verizon or AT&T. In case you don’t remember, Sprint was, 5 years ago, the hot U.S.mobile phone carrier, with consumer mind share and cool advertising.

        While Apple was developing the iPhone, Apple met with all the major U.S. carriers, including Sprint, and Apple even considered becoming a carrier itself.

        Apple, also in China, spoke with all the major carriers. Everybody thought that China Mobile, the largest mobile carrier in the world, would be the logical choice to get the iPhone. But no, China Unicom got it, because Apple got the best terms that it could in China from China Unicom.

      • serpentor

        I’ve had Sprint for more than 10 years and they had some rough times before the iPhone came out 4 years ago.

        I only heard about Apple approaching Verizon about the iPhone, never heard anything regarding Sprint.

  • http://beenswank.net brandonmccall

    And if you look at Sprint’s history. They damn-near introduced the first everything. The first phone with integrated music player, the first phone with a color display, the first phone with a QVGA display, the first camera phone(s), the first 3G network, the first smartphone, the first phone with a 1.3 MP camera, the first phone with a 2 MP camera, and so on. Other US carriers have been playing catch up for years. But you don’t have to take my word for it. Look it up.

    • Anonymous

      Sprint didn’t have the first color screen phone, that award goes to the Sony Ericsson t68. AT&T Wireless had that phone out before the Sanyo 5000.

    • Prophecy

      You should probably look it up. At&t had the first Blackberry the first color screen not to mention the FIRST PHONE and the FIRST CELL PHONE

    • Yormasta

      Go back and do some research,
      you are wrong on just about every everything you mentioned.

      And don’t show me shit on wikipedia,

      • http://beenswank.net brandonmccall

        We didn’t have AT&T in the South East until they bought out Cingular. Sprint was available to all regions of the US. However, I can admit when I am wrong.

      • http://beenswank.net brandonmccall

        And who refers to Wikipedia in order to prove a point on BGR? I’m good.

  • Craig

    Hesse is just mad because no one will buy his company.

  • Anonymous

    Whatever hesse you’re pissed cause you and your garbage network are screwed now.

  • http://pulse.yahoo.com/_FV5FL4QCO6LSMOUXJG2XHS24BI robnfwtx

    I support Dan 100%. He’s not a sore loser DADDY WARBUCKS. AT&T is getting too big for their britches again and should be stopped. Wireless & Broadband Internet caps and now this. Come on, they were broken up for a reason by Judge Green. They shouldn’t be allowed to grow this large again. If so, what was the point of the breakup to begin with when we’re right back where we started?

  • Robert MacDonald

    oh well DAN. Sprint thought buying NEXTEL would make them HUGE. Too bad sprint. Go out of bussiness or sell to VZW. Sprint is a dieing company and Dan still hasnt made it were it should be.

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