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Brier Dudley's blog

Brier Dudley offers a critical look at technology and business issues affecting the Northwest.

June 2, 2011 at 10:57 AM

D9: AT&T exec on T-Mobile deal, shared data plans

RANCHO PALOS VERDES, Calif. — Ralph de la Vega, chief executive of AT&T Mobility, defended his company’s plans to acquire Bellevue-based T-Mobile USA and promised that it will improve service for customers.

Hosts Walt Mossberg and Kara Swisher didn’t seem overly impressed.

Swisher said she recently switched to Verizon — for a white iPhone.

d9delavega.jpg

Mossberg questioned why people should trust AT&T’s promises about the merger when the company consistently ranks low on customer satisfaction surveys.

De la Vega said the company’s first quarter results “speak for themselves.” At the same time a competitor was launching an iPhone, AT&T reported the best quarter of iPhone sales and net customer additions in the company’s history.

The merger is driven in part by the huge increase in data usage on its network, which has increased 8,000 percent over the last four years.

“When we merge the networks of both companies and overlay our network to their network, it irmproves the quality and capacity for both customers,” he said.

In dense cities like New York and San Francisco, the combination will provide a service improvement equivalent to five to 10 years of adding new cell sites, he said.

De la Vega also argued that the wireless market is competitive and will remain so after the merger, but that’s the $39 billion question federal regulators will have to answer over the next year. On Tuesday, Sprint filed its formal objection to the merger.

Mossberg asked about Sprint’s contention that it will be “killed” by the merger.

“I think Sprint has done well in this environment. They’re going to continue to do well; they’re going to continue to innovate,” he said, adding that Sprint and Clearwire together have more spectrum than any other carrier.

Mossberg scoffed at that, saying Sprint and Clearwire aren’t in sync and compete with each other, even though Sprint is the majority owner of Clearwire.

De la Vega is a veteran of BellSouth who was chief operating officer of Cingular Wireless through its merger with AT&T Wireless in 2004.

Moving past the merger, Swisher asked about the rise of the Apple and Google phone platforms.

“Our view has been from the get-go, we want to give customers the choice … we will let the customers decide which one they will participate” with, he said.

Asked about the role of the carrier amid the rise of mobile device ecosystems like Apple’s and Google’s, de la Vega said carriers enable the innovation.

In the future, carriers and device makers will need to collaborate more, he said. The company has already done this with Apple — providing it with specs to develop the first iPhone — and with Microsoft, with which it developed AT&T’s Internet-delivered television service.

Discussing monthly vs. pay-as-you-go data plans for tablets, smartphones and other devices, de la Vega said AT&T is considering new shared data plans that would work with multiple devices.

“I think once you have so many devices that you’re carrying, you may want a shared plan. … The more focus groups that we do, the more we think that may be the way.”

When will it appear?

“I think it will be soon.”

During a question session, de la Vega was asked about renewed concerns about the cancer risk of wireless phones, as called out this week by the World Health Organization, and how it will affect the industry.

De la Vega said the WHO is “a very valid body to look at this,” but it drew on an earlier report that’s been out for a year.

“The industry shouldn’t have too much too worry [about]; nevertheless we should continue to study the matter,” he said.

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