Nov 29 AT 8:58 AM Anthony Domanico 59 Comments

AT&T proposes selling customers and spectrum to Leap Wireless to save T-Mobile deal

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The proposed merger between AT&T and T-Mobile USA just gets more and more interesting. The deal has reached the point where AT&T will need to make several concessions if it is to have even a remote chance of success against a sea of litigation. This will include selling spectrum and customers to smaller, regional wireless companies, who would least likely benefit from the deal going through.

The New York Times reported late last night that AT&T has concocted an 11th hour plan it hopes will spur the Justice Department to drop their lawsuit that seeks to stop the deal in its tracks. Under the new proposal, AT&T would sell off a mixture of T-Mobile’s spectrum and customers to Leap Wireless, which runs Cricket and Jump Mobile. Though AT&T declined to comment as to what the mix of spectrum and customers would be, The Verge goes on to speculate that the selloff would largely lean towards customers, since AT&T’s purchase of T-Mobile was intended to build up AT&T’s spectrum so that it could properly roll out an LTE network.

Facing the need to pay an exorbitant amount of money to Deutsche Telekom as a break-up fee if the deal doesn’t go through, AT&T is doing all it can to ensure that the deal goes through without too many hitches. The Leap Wireless deal can be viewed as a last ditch effort to push the deal through the US government, and it has the potential to be exactly what the deal needed to move forward.

Optimism about the deal took a turn for the worse over the holiday weekend when AT&T announced it was withdrawing the deal’s application to the FCC and that it was charging $4 billion against its earnings to be able to pay a break-up fee should the deal get rejected. With the announcement of a potential Leap Wireless deal, however, it seems the optimism is heading back in the positive direction, with the lawyers who will be handling the merger case now putting the chances of success between 60 and 70 percent.

It seems that AT&T was at least partially telling the truth when they disclosed that the deal was largely made to bolster AT&T’s spectrum in the impending LTE showdown with Verizon and Sprint. If the deal is allowed to go through, several of T-Mobile USA’s customers could become part of a bolstered Leap Wireless, which would become the nation’s 4th biggest carrier.

What do you guys think? Will the deal be more likely to succeed with AT&T’s partnership with Leap Wireless? We know you T-Mobile USA customers were not too keen on becoming part of AT&Ts network, but aren’t you even less excited to become part of Leap Wireless?

Via: The Verge

Source: New York Times

Anthony loves all things technology, from hardware to apps and games. You can connect with him via Google+ or Twitter by clicking one of the fancy doo-dads above.

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