Renata Hesse, senior FCC counsel for transactions, asked AT&T in a letter why the company concluded that building out LTE to 97 percent of the nation makes economic sense only if the company is able to also buy T-Mobile. According to an earlier filing, posted on the FCC website by mistake, AT&T’s top officials rejected a proposal earlier this year to expand the system to the same coverage levels prior to the merger announcement, citing the $3.8 billion expected cost (CD Aug 12 p1). “We understand that AT&T’s senior management concluded the transaction would improve the likely return on the additional LTE deployment to create a business case for this deployment where one would not exist absent the transaction,” the letter said. “Although AT&T has stated that it has not quantified the transaction-related changes in the business case for extending its LTE footprint, we ask that you supplement your filing with any documents or analyses explaining why the changes in cost, revenue, and/or profitability are likely to be large enough to change the overall business case for the additional deployment.” AT&T spokesman Mike Balmoris said the company expected the FCC to ask more questions on that topic given the detailed review underway. He said the additional information “will further confirm that we would not be able to deliver 4G LTE to 55 million more Americans without our merger with T-Mobile."
Free Press urged AT&T/T-Mobile deal supporters in Congress to reconsider, given AT&T’s recent FCC filing (CD Aug 12 p1) showing the carrier could deploy in rural areas for $3.8 billion. The nonprofit on Wednesday wrote the 76 members who signed a June 24 letter to the commission and Justice Department saying the deal would bring broadband to unserved rural areas (http://xrl.us/bmah8p). “Recent press reports reveal that in January AT&T decided that, rather than spend $3.8 billion to build out its network, it would spend 10 times that amount to take over T-Mobile and use the promise of rural deployment as a carrot to win approval,” Free Press political adviser Joel Kelsey said. “In AT&T’s eyes, eliminating a competitor from the market is a better business plan than investing in its network.” AT&T disagreed. “Once again, Free Press is twisting words and misrepresenting facts,” a company spokeswoman said. AT&T’s letter to the FCC “makes clear the dramatic scale of our commitment to bring 4G LTE mobile broadband to 97 [percent] of all Americans,” she said. “Simply put, AT&T would not be able to deliver 4G LTE to 55 million more Americans without this merger."
Top AT&T executives rejected a proposal earlier this year from the company’s marketing organization to expand the carrier’s LTE footprint beyond its current goal of covering 80 percent of the U.S. population by the end of 2013. AT&T disclosed that in an FCC filing on a recent meeting with key agency staff. The company promised in March to expand its LTE offerings to cover 97 percent of Americans if its buy of T-Mobile is approved. The filing explains in some detail why the company concluded it couldn’t justify the cost of this aggressive rollout without the T-Mobile buy. The filing pegs the cost at $3.8 billion.
Verizon’s Q2 profit came in at $1.6 billion versus a loss of $1.2 billion in the year-ago quarter. It added a total of 2.2 million subscribers, including 1.3 million postpaid customers, bringing the total connections to 106.03 million.
Global TV ad sales should increase 3.8 percent in 2011 to $149 billion, Informa Telecoms & Media said. “Growth thereafter will generally be slow, though the soccer World Cup Finals in Brazil will boost the 2014 figures and the 2016 Olympics (also in Brazil) will have a similar impact.” The forecast for 2011, after sales gained more than 10 percent in 2010, reflects the perception that the global economic recovery isn’t on solid footing, said Adam Thomas, Informa’s media research manager. Audiences have become more fragmented, giving advertisers more outlets to turn to reach them, he said, allowing advertisers to “negotiate lower rates."
Imposing the right window determining how soon consumers can watch Viacom shows online or on mobile devices is vital to the company’s strategy in extending its distribution to the platforms, CEO Philippe Dauman said Thursday on the fiscal Q1 earnings teleconference. “A window makes it complementary” to Viacom’s traditional businesses “and makes the revenue that we're getting under this deal incremental,” he said. Dauman was referring to a new deal with Hulu that will bring some Viacom shows back to Hulu.com and add programming to Hulu’s nascent subscription service, Hulu Plus.
Vivendi completed the sale of its remaining 12.34 percent of NBC Universal to General Electric for $3.8 billion, paving the way for the recently-approved Comcast-NBCU transaction, it said.
Globecomm will design and install antenna switching systems and refurbish existing antennas for an undisclosed “major media and entertainment company,” it said. The $3.8 million contract also includes Globecomm’s network management software and engineering support, it said.
Motorola posted a Q3 profit of $109 million, up from $12 million a year earlier. Revenue jumped to $4.9 billion, in its first year-over-year revenue increase since 2006. The company and a few other iDEN players said they remain confident of the technology despite Sprint’s intention to phase out its network that uses it.
Arbitron Q2 sales gained 1.8 percent from a year earlier to $88.3 million. Costs increased 2.1 percent to $87.7 million. Working closely with radio clients, Arbitron will promote the medium to advertisers and marketers, CEO William Kerr told investors. “We are looking to become an advocate for radio and to increase the medium’s profile in the ad buying and planning process.” Profit gained 8.7 percent to $3.8 million.