Mikey Campbell
Apple partner carrier AT&T on Thursday received approval from the U.S. Federal Communications Commission to go ahead with a previously announced acquisition of prepaid mobile provider Leap Wireless worth $1.3 billion.
Under terms first announced in July of 2013, AT&T will acquire all Leap Wireless stock and network properties for $15 per share in cash, a deal that now amounts to $1.3 billion. As part of concessions to appease competition watchdogs, AT&T informed the FCC that it will be offering Apple's iPhone 5 to Cricket customers once the buyout is complete.
The acquisition was expected to be finalized sometime between January and March pending government approval, which AT&T received today from the FCC. Re/code was first to report the commission's decision.
According to the FCC's full transaction order, regulators looked at antitrust concerns, pubic interest, wireless spectrum analysis and other facets of the proposed deal. After numerous discussion, it was determined that Leap was not a so-called "Maverick" disruptor and that AT&T's plans to appropriate a portion of the smaller carrier's spectrum for its LTE rollout will benefit, not harm consumers.
Specifically, the acquisition gives AT&T spectrum in the PCS and AWS bands, which are "largely complementary" to the telecom's existing licenses.
As of the filing date, Leap has about 5 million subscribers spread over 35 states and spectrum licenses serving 137 million people. AT&T has over 110 million subscribers with a network covering approximately 308 million nationwide.
Leap's Cricket was the first prepaid carrier to offer Apple's iPhone in June 2012, selling the 16GB iPhone 4S contract-free for $500 alongside an unlimited plan priced at $55. At the time, the company was seen as paying a $150 subsidy to Apple.
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10 Comments
Are there a multitude of people who own multiple devices? Both VZW and AT&T have over 100 million customers, and Leap has 96 million, that would leave just a few hundred thousand customers for the other carriers, if we are to believe that there's just over 300 million people in the US.
Bit late to offer the iPhone 5 now.
Odd that ATT would want them. The point about "complementary" bands seems credible but, really, this doesn't extend their footprint directly. It's a different network so they're really operating two sets of bands now.
Sounds like they're pulling a Sprint. Those folks are well known for disappointing investors and customers alike with their purchase of incompatible networks. Now Cricket customers can get used to several years of a possibly bumpy roadmap.
Anyway, seems like a more obvious choice for Sprint to have bought them. I trust Sprint will find other incompatible technology to buy. They're good for that.
This is wrong: "Leap has about 96 million customers" Try closer to around 5 million. (4.6 million per Wikipedia) We need some editing and fact checking here before these stories are posted.
This is wrong: "Leap has about 96 million customers"
Try closer to around 5 million. (4.6 million per Wikipedia)
We need some editing and fact checking here before these stories are posted.
thanks for checking -- that number sounded absurd to me, too.