M&A in telecom: TMO Buys Most of USCC!

Opinion
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Oh the humanity! The telecom landscape will never be the same. Oh, that’s right, so many small telecoms have already been sucked up. US Cellular was one of the few holdouts, until now. Business as usual.

It’s finally official: T-Mobile (TMO) bought most of US Cellular Company (USCC)!

Let’s look at the highlights of the deal. For our industry, this is an exciting M&A deal.

To be clear, this is from me, Wade, and is not the viewpoint or opinion of anyone I work for or with. If some of them agree with me, great!

Also watch the video on YouTube: :point_right: https://www.youtube.com/watch?v=Ab52-wzn-3U

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M&A will continue in telecom.

Actually, subscribers do not need so many cellular operators.

I think two per country are enough.

Cellular operators all over the world have done little innovation in business terms. Offering more G wont bring more $.

CXO, Board of Directors must sit and discuss: " What if we offer voice and internet for free to each and every subscribers. Then, how do we make money".

I had suggested such disussions in this group a few years ago.

The longer they delay this discussion, the frequent the M&A will be.

There is nothing sexy in voice calls and internet.

Making money from offering ‘crystal clear’ voice and streaming internet is a bad idea.

The worst idea is that, cellular operators are using Data Science, ML & AL to improve the quality of voice and internet services.

Don’t they realize that subscribers already dont give a s*** to their services.

Using AL/ML to improve voice/internet quality is simply like increasing the OPEX. It will hasten the decline of the operator.

Cellular operators must use AL/ML over their data to offer new services. What are those services? I dont know. But unless we start discussing this idea, we will never know.

One thing I saw… some operator in UK said they will integrate bitcoin wallets. This is a babystep in right direction.

Can cellular operators offer P2P market services for bitcoin? They already pass their subscribers through painful/lengthy KYC process.

Can I buy bitcoin against the minutes I have?

Can I sell bitcoin against the unused internet data that I know I wont be able to use before the package expires?

Can cellular operators predict when the customer will have medical emergency?

Can they predict when the customer will need to reduce the usage of some apps, lest they get some medical problems?

Personalized (non voice/internet) services to subscribers.

Another idea could be to enter e-commerce industry.

Can we allow our subscribers to buy something from Amazon using our internet minutes?

There are so many opportunities all around the world.

Cellular operators could let people buy US Stocks via their internet minutes.

Let them onboard stock brokers. recommend stocks to them.

Predict the personality of subscrbiers… and recommend stocks according to their personality.

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Operators already lost this market to OTTs / Apps.

Google and Apple won’t be supporting any kind of operator service natively that would compete vs Google Play Store and AppStore.

RCS is has some potential for this.

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How long it would take operators to launch their own OS?

As I mentioned, cellular operators only focus is voice and internet quality.

Something no one cares about.

The money has to be made from new services.

If Google and Apple are choking the road, throw them off.

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GSMA should lead this.

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It’s too late to talk about ‘should’.

The operator which takes the lead… will capture the complete market.

Offer OS which is most suitable for offering AI powered chatbots.

Android and iOS are still getting ready for it.

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Google could become a world operator before they accomplish this :sweat_smile:

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Why would Operators have their own OS?

They can have their own markets… but in times, all markets and their OS will be independent and transferable.

Then what? Not all csps can have sources like Huawei to maintain ‘harmony’.

Better OTTs should pay to csps.

OTTs competing in same services of csps.

So for example whatsapp texting and calls should cost end customer more than cellular SMS and calls.

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This is not going to happen.

Rather, OTTs may launch their own cellular networks.

The key to understand is that, there’s no juice in voice and internet.

Until and unless CSPs accept this, they will keep bleeding.

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I’m just wondering why you keep saying that, and the entire (Telecom) industry is based on this? Internet and Voice.

Each generation (solely) had been developed and engineered to overcome the (slow) internet speed and to offer more capacity to make more voice calls with better quality utilization the same spectrum.

Your insights might be targeting operators and countries with already (saturated) infrastructure that can offer no more of speed/quality to their basic (fundamental) services - therefore, they chose to pick (pioneer) services and come with (out of the box) ideas to attract customers.

Nevertheless, the portion mentioned above is very small, hence the majority of world’s operators are still suffering from their underdeveloped infrastructure since all of them having swaps/upgrades annually to keep up the race with their competitors (offering higher Internet speed and better voice quality with no interruptions).

Again, the issue from a subscriber’s perspective is not (higher) price anymore, since most of the offered packages have decent prices, but the quality of the basic (fundamental) services they’re getting from xyz operator.

That’s why I would choose A company (with slight higher packages prices) over B because of the better Internet speed and better voice.

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This is not the case. No operator in the world is ready to sell QoS subscriptions say 20 Mbpsec guaranteed anywhere / anytime.

Although in Europe there would be many people willing to pay 50 euro / month for this 20 Mbpsec guaranteed anywhere/anytime. Instead we pay 2-3 euro / month for unlimited voice and internet with no QoS.

CSP have to reinvent themselves to allow AI to optimize RANs and to make RAN elastic to accommodate QoS. Only then CSP will be able to make more money.

By selling Qos.

This is the only thing people are willing to pay for extra money: QOS.

And for over 15-20 years CSPs are not able to sell QoS although they know people and corporate are asking for it.

Instead we get Gbpsec when we don’t need it and we do not get 20 Mbpsec when we need it.

Traffic is 99% predictive so why is so difficult to ensure coverage and capacity to be able to sell QoS?

What was more important than this in the past 15-20 years? And still we are not yet there.

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This is practically not possible.

Imagine a user who paid for 20 Mbps who went on vacation in remote area with high congestion,low coverage. How would he get 20 Mbps?

Same for a user who lived in dense urban area with high congestion…

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You guys are too much into telecom technology. So, let’s start from the basics. :slight_smile:

For a human society, what’s the most important utility after food and shelter.
Its electricity.

Electricity is so important for life, that humans can live in deserts (GCC, without water), but cannot live without electricity.

Most people in GCC get desalinated water… it’s all due to ample amount of cheap electricity.

Now, given that electricity is 10 times more vital than telecom/ICT services, you would like to have the best electricity services.

How many electricity operators do you have in your city?

Have you ever thought… ummmm… this electricity operator is giving electricity which is unreliable. let’s switch to another operator?

If electricity, which is so important for life, doesn’t have redundancy/ competition, why on earth we need so many CSP in same country.

This is simply wastage of resources.

The world suffers from water shortage… global warming…etc.

These pressing problems do not require outstanding cellular services… even for B2B, enterprises… corporate… they mostly use fiber.

Anyone who sold us the idea that having four CSPs in a country was essential for having a competitive market and hence good QoS… he/she had something to sell.

They sold too much of network equipment…

Which was never needed at the first place.

To ensure good QoS, you have regulators.

Just like you have regulatory authorities regulating electricity services provided by one (or at most two) operators.

Telecom/ cellular services is a utility… just like electricity and gas.

Most countries in the world even today require people to use gas cylinders.

And we are talking about 6G.

Is it more important to provide gas to homes via underground pipe network… or to provide 5G/6G.

80% of home electricity bill comes from poor HVAC systems.

Is it more pressing to provide geothermal heat pumps to homes, or to provide 6G?

We need to put ourselves in shoes of customers to think our value proposition.

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The QoS is only for coverage area.

I think it is possible.

How is possible to have congestion in dense area now wih 5G CA, 5 LTE CC?

I found it totally embarassing not to be able to provide 20 Mbps in dense urban.

What do they spend their CAPEX on?

People will pay for 6G, they will not pay for geothermal heat pumps.

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In market like India, it’s very difficult to achive even 5 Mbps everywhere.

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I agree in India few people will pay 50 USD / month for QoS, but in Europe many will pay.

In fact, regular subscription now are in Switzerland and Monaco like 100/euro per month without any QoS.

With QoS CSP could get 3x that amount.

Problem is that there are too many MNOs in each country: 4 in UK, 4 in Germany etc.

They cannot survive.

In Romania any new site, since 10 years ago, will share the tower with all other MNOs for cost reduction.

RAN sharing is almost everywhere.

There are simply too many MNOs on the market so it is likely some will not survive in next 5 years.

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Europe needs to worry more about having gas in the winter.

They will run out of electricity if they won’t pay for heat pumps.

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That’s not a subject for MNOs.

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It is. Higher cost of energy means higher OPEX for MNOs.

Also, higher cost of energy means lower disposable income with subscribers.

ARPU will decline further.

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Energy is cheap in Europe.

So many solar and wind turbines. :wink: