AT&T May Look For Overseas Ventures To Help Grow Company
Michael Harper for redOrbit.com – Your Universe Online
According to a new Wall Street Journal report, AT&T may be looking across the pond for new cash streams. Not content with their growth potential here in the States, AT&T may be looking for companies to either buy or merge with in highly competitive Europe.
Once in Europe, AT&T is expected to take the opportunity to expand their network as well as roll out new technology and tweak their pricing strategies. Such a move follows a failed merger with T-Mobile and the entrance of a Japanese company— Softbank— into the American cellular market.
Citing sources familiar with the matter, the Wall Street Journal claims Ma Bell is in the research phase of their plans, investigating which deals they’d like to make with which companies. These people also say AT&T is looking to move quickly and should have a deal set in place by the end of 2013.
Of course, one does not simply walk into Europe and begin offering cellular service to its residents. European markets, such as those in Germany and the UK, are highly competitive and operate differently than those in the States. British iPhone users, for instance, have their choice of carrier and don’t have to purchase their Apple smartphone through a particular channel. Should they find themselves dissatisfied with one carrier, they can simply replace their SIM and take their phone elsewhere.
With so many established cellular providers in the area, AT&T’s top executives are examining the possibilities of simply buying out an existing company, though they’re also debating moving in on their own.
AT&T lost their deal to acquire T-Mobile last year, leaving them without a new carrier and several million dollars poorer. Moving their focus to Europe could help the company expand, bringing in more cash. However, should the company shift their attention elsewhere, they could lose ground to Softbank, which is working to complete their 70% buyout of Sprint.
Softbank is expected to bring in more capital for Sprint, making them a more aggressive competitor. Sprint’s executives have already claimed they’ll be using some of this capital to introduce new pricing schemes in order to disrupt the current American markets.
Though WSJ’s sources have said AT&T is interested in moving to the East, they weren’t clear on which companies AT&T are currently talking with. The Netherlands’ largest carrier, Royal KPN NV, as well as Everything Everywhere, another large UK carrier, are both expected to be on AT&T’s radar, according to these sources.
At present, there appears to be a slight opening in the European markets where data is concerned. This is a hole AT&T is expected to fill and take advantage of, say the sources, earning themselves leverage before other carriers begin to broaden their data offerings.
Last June, AT&T’s CEO Randall Stephenson told his investors that an overseas expansion wasn’t out of the question, but wasn’t a “high priority” either. In this month’s issue of Texas Monthly, however, Stephenson was quoted as saying such a move would be “inevitable.”