Why Consumers are Concerned if T-mobile goes Bigger

TigerOptions
05-29

$T-Mobile US(TMUS)$’s acquisition of a significant portion of U.S. Cellular for $4.4 billion is a big move in the telecom industry. While this could benefit T-Mobile from an investor standpoint, it raises concerns for consumers.

CNBC news

This deal expands T-Mobile's reach by adding U.S. Cellular's customers, spectrum assets, and stores. This could give them a significant edge in the ongoing competition with $Verizon(VZ)$ and $AT&T Inc(T)$. From an investor's perspective, this increased market share and potential for customer growth is a positive sign.

However, as a consumer, this trend towards industry consolidation worries me. With Verizon having acquired TracFone last year, we're witnessing a telecom industry with potentially only three major players. This lack of competition often leads to higher prices and potentially lower quality service. We saw this with TracFone after the Verizon buyout, and similar issues could arise here.

Mike Sievert

While T-Mobile was once known for its aggressive pricing and customer focus, there have been changes under CEO Mike Sievert. Recent price hikes on older plans and a perceived decline in company culture are points of concern for many customers, myself included. This acquisition could further exacerbate these issues, with a focus on market dominance potentially overshadowing customer satisfaction.

TMUS Daily Chart

In the daily chart, TMUS looks to be in a bullish consolidation. A break above 169 could continue its bullish trend while a retracement back to 162.50-165 still keeps this stock in a bullish trend. However, a sharp fall below 162.50 will be concerning and might signal a change in trend.

I have mixed feelings about this acquisition. As an investor, the deal strengthens T-Mobile's market position. However, from a consumer’s standpoint, people are concerned about potential price hikes and a decline in service quality due to less competition. The long-term impact of this deal remains to be seen, but I'll be closely monitoring how it affects T-Mobile's customer service, pricing strategy, and overall company culture. Hopefully, the government will also be vigilant in ensuring this consolidation doesn't lead to a negative impact on consumers.

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Disclaimer: This is not financial advice. Please do your own research before making any investment decisions.

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  • PhoenixWhitman
    ·05-29
    Less competition could lead to higher prices and lower service quality.
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  • TomCap
    ·05-29
    I agree with your concerns as a consumer.
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