Why AT&T’s deal for T-Mobile must be blocked • Hacker News Board

Re: Why AT&T’s deal for T-Mobile must be blocked

#31

Post by jerf » Mon, Mar 21, 2011, 7:17 PM UTC

Schultzy wrote: post #19

Bud wrote: post #2

Mr. Arends makes a very strong argument. And really, if you need a shorthand way to understand this issue, all you need to know is that the Bush Administration stripped away the limits on one company's ownership of spectrum. Republicans talk a good game about the "free market", but it's internally inconsistent talk; you can't have a free market if the number of players in said market gets below a certain level. 4-5 i…

What's so bad about a monopoly in a free market? Doesn't that just create opportunity for some other carrier, perhaps a currently small regional company, to step up and fill that hole? If the pain is big enough, there will be competition. If we mandate competition, it's not a FREE market.

"If we mandate competition, it's not a FREE market."

In addition to the other fine replies made, I want to highlight this to strongly disagree with it. In fact actually having a free market requires aggressively protecting it when a given market naturally coalesces into a monopoly or oligarchy. Trust-busting isn't an anti-free-market position, it's a pro-free-market position. The anti-free-market actions come from governments picking winners and enshrining monopolies/oligarchies through regulatory capture.

In particular, when advocates of other social organizations level this as a criticism of free market, my response is to point out that when you have lack of mandated competition with some form of government-selected winners, be it communism, socialism, or "crony capitalism", you don't have a free market at all and the criticism is more generally applicable to the social organization being argued for by the person raising this criticism.

In a free market, a new company always ought to be able to come along and completely destroy an existing company if they do a good enough job. If you don't have this, you don't have a free market.

Re: Why AT&T’s deal for T-Mobile must be blocked

#32

Post by baggachipz » Mon, Mar 21, 2011, 7:18 PM UTC

dasil003 wrote: post #21

baggachipz wrote: post #4

We can bitch and moan all we want, but the truth is that this deal will absolutely go through. If there's enough outcry, expect a dog-and-pony show on C-SPAN; in the end, they'll approve the merger with a "stern warning." Count on it.

The cynic in me agrees, but I think it's reasonable to believe that if the public outcry were enough, regulators would stop this. So why are we sitting here upvoting cynical comments on HN rather than mailing representatives?

Personally? Because I think an HN upvote will have more effect. True story. NB: I live in South Carolina.

Re: Why AT&T’s deal for T-Mobile must be blocked

#33

Post by MichaelApproved » Mon, Mar 21, 2011, 7:22 PM UTC

harryh wrote: post #15

gpapilion wrote: post #12

Earlier quoted context omitted.

I actually doubt this merger will go through. This would put AT&T far ahead of Verizon in term of subscribers, even if they are less desirable due to the low ARPU. There isn't enough churn in the wireless market to balance the AT&T and Verizon out over a reasonable time, and Sprint would now be a distant third. Effectively this will shut anyone else out of the National carrier business, and eliminate the possibility…

You care to put your money where your mouth is? I've got 500 bucks that says you're wrong.

500? Sounds good to me. Meet me in the options market.

Edit: Bought 10 July 28 puts and sold 10 July 27 puts against it. If AT&T is below 27 by July expiration I make $500. If the stock is above 28 by July expiration I lose $500.

Re: Why AT&T’s deal for T-Mobile must be blocked

#34

Post by aaronbrethorst » Mon, Mar 21, 2011, 7:27 PM UTC

hyperbovine wrote: post #16

Bud wrote: post #2

Mr. Arends makes a very strong argument. And really, if you need a shorthand way to understand this issue, all you need to know is that the Bush Administration stripped away the limits on one company's ownership of spectrum. Republicans talk a good game about the "free market", but it's internally inconsistent talk; you can't have a free market if the number of players in said market gets below a certain level. 4-5 i…

Bush's term ended in 2008. I think that's a salient point.

It actually ended in January 2009.

Re: Why AT&T’s deal for T-Mobile must be blocked

#35

Post by wtn » Mon, Mar 21, 2011, 8:15 PM UTC

clistctrl wrote: post #9

I wonder how much of this deal was made with the intention of acquiring T-Mobiles spectrum rights? I'm under the impression that GSM was mainly a technology focused in the time domain, and the newer 4G technologies seem like they're more centered around the frequency domain. It occurs to me that if lack of spectrum is a problem for 1 it is probably a problem for the other, so it would make sense for both carriers to…

Nailed it.

Re: Why AT&T’s deal for T-Mobile must be blocked

#36

Post by rhaygood » Mon, Mar 21, 2011, 8:16 PM UTC

Having just been mugged by T-Mobile (read here for the details: http://nyti.ms/dRW9yO), I can't say I expect worse customer service from AT&T, but that certainly isn't saying much. Oligopoly means rarely having to say you're sorry; monopoly means never having to say you're sorry.

Re: Why AT&T’s deal for T-Mobile must be blocked

#37

Post by evo_9 » Mon, Mar 21, 2011, 8:20 PM UTC

aaronbrethorst wrote: post #34

hyperbovine wrote: post #16

Earlier quoted context omitted.

Bush's term ended in 2008. I think that's a salient point.

It actually ended in January 2009.

Really? I couldn't tell the differences based on how the new guy has been acting(see: Wall Street bailout, lack of standing tall with Wisconsin Union, Domain Take-Down practice, etc). I wish it were different than this, why I voted for change in the first place. Ah well.

Re: Why AT&T’s deal for T-Mobile must be blocked

#38

Post by seanalltogether » Mon, Mar 21, 2011, 8:25 PM UTC

bgentry wrote: post #3

This quote summarizes the whole issue for me: Two weeks ago, as it happens, I took my business away from AT&T. The reason? Simple. T-Mobile offered me a better deal. Lower prices. No two-year contract. And monthy savings because I brought my own phone. It was a free market. So I moved. And now, that choice is gone. Sure, you can choose between companies A, B, & C. All of which cost roughly the same, nickel & dime you…

I bought a nexus one and moved to tmobile for exactly those reasons.

Re: Why AT&T’s deal for T-Mobile must be blocked

#39

Post by Qo » Mon, Mar 21, 2011, 8:28 PM UTC

Bud wrote: post #30

dangero wrote: post #13

This article comes off as very whiny. It may decrease competition, but that doesn't mean it creates a monopoly.

It creates a monopoly in the GSM space and an effective duopoly overall. Pretty darn close.

Even if this deal goes through, you'll have three national carriers to choose from and, depending on where you live, one or more regional carriers, plus VoIP. That's not pretty darn close to a monopoly at all.

I think there's a stronger case for a GSM monopoly, but at some point the argument becomes silly - where do you draw the line between an uncompetitive market and a market with product differentiation? Would you have broken up Standard Oil because they were the only ones offering Super Unleaded?

Re: Why AT&T’s deal for T-Mobile must be blocked

#40

Post by plusbryan » Mon, Mar 21, 2011, 9:24 PM UTC

Without knowing much about the mechanics of acquisitions of this magnitude, how plausible is it that AT&T made the offer simply to prevent Sprint from acquiring T-Mobile and creating another competitor? I mean, if they're pretty sure the FTC would block them anyway, if they set a high price, they've just made it harder for Sprint to attain their size.