AT&T's Stephenson: We didn't execute well on T-Mobile deal
BOULDER, Colo.--AT&T (NYSE:T) CEO Randall Stephenson admitted that his company didn't execute well on its proposed $39 billion dollar deal to purchase T-Mobile USA when it made a bid for the operator in 2010. "I wouldn't say it was a bad decision, but it was a decision that didn't go the way I wanted," Stephenson said. "We didn't execute well." The company ended up dropping its T-Mobile bid in late 2011 amid regulatory opposition.
In a candid interview with Phil Weiser, dean of the University of Colorado Law School and executive director of the Silicon Flatirons at the Silicon Flatirons Center's Digital Broadband Migration conference here, Stephenson said that the failed T-Mobile deal was one of his worst moments as CEO, but added that one of his great moments was in 2007 when AT&T decided to bet on Apple's (NASDAQ:AAPL) iPhone. "We didn't have a great vision as to where this would go, we just knew that when you took data utilization and made it mobile, it would explode," he said.
Stephenson said that Stan Sigman, then-CEO of Cingular Wireless, was the passionate driver behind the iPhone, and he remembered asking Sigman and the Cingular board members whether they were betting on the market, the device or Steve Jobs. "We were betting on Steve Jobs," Stephenson said. "And time has proven that to be a good bet. But it was not a partnership that came without pain," he said, alluding the company's network issues that developed as a result of the overwhelming amount of data usage by iPhone users.
Interestingly, Stephenson also said that while he doesn't really know what Dish Network (NASDAQ: DISH) Chairman Charlie Ergen plans to do with his company's spectrum, he believes Dish will end up partnering with a wireless company instead of building an LTE Advanced network on its own. Dish currently has 40 MHz of S-Band spectrum, rebranded as AWS-4 for terrestrial mobile use, and has said it plans to build an LTE Advanced network using those airwaves. However, Ergen has hinted that he would like to partner with an existing wireless carrier rather than do it alone. The company earlier this year made an unsolicited counterbid for Clearwire (NASDAQ:CLWR) at $3.30 per share. Clearwire has said it is weighing that bid along with one from Sprint (NYSE:S), which was for $2.97 per share.
Regarding spectrum, Stephenson reiterated the need for the government to make more spectrum available and also said that unlicensed spectrum is going to continue to play an important role for AT&T. He said that AT&T was the first to require device makers to put a Wi-Fi client in their devices so customers could move off licensed spectrum and onto Wi-Fi. He also noted that having that Wi-Fi client in the phone is critical to the customer experience, particularly with usage-based pricing. "With usage-based pricing we have to give customers an avenue to be efficient and use Wi-Fi," he said.
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