End of AT&T Deal 'Disappointing': Deutsche Telekom CEO


The rejection of AT&T’s takeover bid for T-Mobile USArepresents a missed opportunity to build faster broadband networks in the United States that could cope with an increase in traffic, Deutsche Telekom CEO Rene Obermann said on Tuesday.

T-Mobile Sidekick

“The traffic volumes in mobile Internet are going up so fast that we need more radio capacity, and the combination of T-Mobile and AT&T would have created additional capacity. It would have made a lot of sense for consumers, for customers, for innovation and for competition,” Obermann told CNBC.

Obermann argued that the transaction would have been a big catalyst for the United States to achieve its target of building better broadband networks.

“Together with AT&T we could have built our very fast LTE (long term evolution) network,” he said.

Mobile phone companies are investing heavily in the rollout of fourth-generation networks based on LTE technology, promising high speeds to cope with the explosion of mobile data usage.

“It’s disappointing to see that this transaction couldn’t find approval even though AT&T and ourselves would have made significant concessions to address the concerns of the authorities,” he said.

Obermann declined to speculate on whether the group could now contemplate a deal with Sprint , which had been rumoured before the AT&T deal surfaced.

Deutsche Telekom demanded one of the largest break-up fees in history and will receive $3 billion in cash proceeds as well as some additional spectrum in the U.S. Obermann said the group would continue to seek to improve its competitiveness in the U.S. market.

“In the long run, we are still confronted with spectrum constraints and we need to find a god way into LTE (long term evolution) technology and we will work on this,” he said.

Deutsche Telekom shares traded lower in morning trade in Europe, bucking the trend for Germany's DAX index.