AT & T Merger

SGMT  6050  –  Case  Write-­‐Up   McCaw   Cellular  Communications:  The  AT&T/McCaw  Merger   Negotiation     Armin  Ezatagha     Student  Number  ⏐  205  576  707   eMail  ⏐  aezatagha12@schulich.yorku.ca     Schulich  School  of  Business   Tuesday,  March  05,  2013                                 Current  Telecommunications  Ecosystem     McCaw  Cellular  Communications  (MCC),  although  positioned

Picker and Kang compared and contrasted the merger of AT&T and Time Warner to the merger of Comcast’s acquisition of NBC Universal back in 2009. That acquisition

For example the AOL company spent 186.2 billion on Time Warner when they merged in 2002 which made it the biggest merger ever. This was an unsuccessful merger as AOL based its model on dial up modems but consumers were switching to broadband. So subscribers ended leaving AOL and within 2 years AOL had about $99 billion wiped off its value. In 2009 the companies were de merged The advantages of merging with a company is you get shared power over the market, and also you make profits from both companies so your money increases.

An account of the meeting told that Justice Department officials required AT&T to sell Turner Broadcasting, which will serve as a possible requirement for AT&T to clinch government approval. Another account claims that AT&T can sell off DirecTV, which the telecommunications giant has acquired for nearly $49 billion in 2015. However, AT&T and Time Warner shared a sentiment that such a concession

Our case study titled, The AT&T and McCaw merger negotiation, provides us with an opportunity to negotiate the terms of the merger between McCaw cellular and AT&T. McCaw was the largest competitor in the rapidly growing cellular telephone communications industry. AT&T was the dominant competitor in long-distance telephone communications in the United States, and one of the largest corporations. Prior to the negotiations, it had no position in cellular communications.

The federal government has recently filed a lawsuit against AT&T and Time warner for trying to vertically merge together. The reason why the government is filing a lawsuit against the merge is that AT&T- Time Warmer will be able to demand higher prices for consumers to receive networks such as TNT, TBS, and CNN. AT&T makes the argument that this vertical merge has earned the green light from the government in the past. For example, in 2011 when NBC and Universal merged together as a vertical merge the government approved it but the Justice Department and the FCC set a variety of conditions in order to approve the vertical merge between the companies. The DOJ also argues that by completing this merge the companies will raise cost to consumers

If they are able to maintain the loyalty of most of their current customers, the companies will then have a shared amount of about 100 million customers. This potential customer volume for the merging companies would greatly outnumber the customer volume of the industry leaders, AT&T and Verizon. This kind of turnout would create greater competition between the two merging companies and the two leading companies (Sprint Wireless News, 2014). Although the outcomes seem promising for Sprint and T-Mobile, there are also potential negative effects of a merger that the companies should take into consideration. Current Sprint and T-Mobile customers have expressed their fear of the possible merger for multiple reasons. The two biggest worries for telecommunication services consumers is the potential for rising costs and a reduction in provider options (John, 2016). In making a final decision, the companies, as well as the Federal Communications Commission, should weigh the advantages and disadvantages of a

Wells Fargo had said that they open 1.4 million fake accounts but eventually it went up to 3.5 million fake accounts. Those accounts weren’t use by the customers. Wells Fargo company discovered that their employees were the reason behind the scandal by using unauthorized credit card and bank accounts from customers who wasn’t activity using them. Wells Fargo realize that this problem was dating back since the early 2000’s. Wells Fargo also had another scandal that involved 570,000 auto loan customers who were charged with insurance that they didn’t use which eventually resulted in repossessing cars of those customers. Wells Fargo was fined for 185 million dollars after Wells Fargo said that the employees had opened fake accounts. Wells

This merger was expected to be scrutinized by both the Department of Justice and the FCC. Many believed this merger would decrease competition and increase prices which will harm consumers, the Department of Justice agreed and so did the FCC. The Department of Justice believed if the two companies if combined would be in an extremely powerful position, providing high-capacity data services to almost half of American households and limiting the choice of those customers. Almost a year after the announcement the deal fell apart, Comcast decided to walk away from the 45.5 billion dollar deal. The attorney General at the time Eric Holder tipped his hat to companies like Netflix who raise concerns about such a merger.

The overall cable industry has lost five million customers between 2006 and 2009 to fiber optic and satellite solutions (Yao, 2010, p. E2). Satellite carriers DishNetwork and DirectTV service thirty-three million customers. Both satellite and cable providers have been targeted, by fiber optic providers, like AT&T and Verizon communications.

One of the goals of creating the merge was to allow Wendy’s shareholders to receive a premium for their shares.

The dominant economic traits of this industry start with having an enormous amount of capital required for staying competitive. One is also required to spend lots of money on research and development, as the telecommunications industry seems to be the vision of the future. More and more companies like AT&T are trying very hard to combine their network services of phone line, video and data transfer, high speed internet access, and television cable via one line in the consumers homes. With a successful combination of the above stated services AT&T is hoping to be the industry leader in the near future.

The purposes of this report are to (1) address the problems Sprint and Nextel incurred before the merger, (2) discuss

I think that conducting lab experiments with lethal viruses in the manner that the researchers in Michael Specter’s article did is innately unethical. Specter writes “Fouchier explained that he and his colleagues ‘mutated the hell out of H5N1’-meaning that they had altered the genetic sequence of the virus in a variety of ways” (Specter, 2012). From the context of the article, one can guess that Fouchier was attempting to study mutation and transmission of the bird flu. While research like this is not new, Fouchier’s attitude comes off as incredibly blasé for a topic that holds high seriousness. Specter later states “Then, as Fouchier later put it, ‘someone finally convinced me to do something really, really stupid” (Specter, 2012) which refers

* AT&T should take advantage from slowing down in the merger activity and lower premiums. If negotiations take a long time, situation can reverse, driving the costs of acquisition up