AT&T T-Mobile Deal – Opportunity for Innovators

I see the proposed merger of AT&T and T-Mobile as an opportunity for innovators and mobile service providers.  I have heard that Sprint executives believe this proposed merger will curb innovation and be a drag on competitive offers for consumers and businesses.

I believe this merger presents an opportunity for Sprint to be a low cost provider and innovator as T-Mobile has been quite successful as a low cost provider.  Sprint definitely has many obstacles such as acquiring spectrum, but I believe the FCC will provide new opportunities to acquire spectrum for next generation connectivity.

A new player emerged last year called Lightsquared, which is backed by Hedge Fund operator Phil Falcone of NYC based Harbinger Capital.  Falcone became a billionaire by making early bets in 2007 that the residential real estate and mortgage related securities markets would implode.

LightSquared is building a state-of-the-art open wireless broadband network. This open network will unleash the full power of the mobile Internet, driving innovation on devices, applications, and services.

I believe Lightsquared has a very strong business model in Two Primary Ways:

  1. Lightsquared is deploying a 4G LTE wireless network that is being overlaid with terrestrial and satellite technology to ensure constant connectivity, regardless of location. The LightSquared satellite, built by Boeing, was launched into geostationary orbit over North America in November 2010.  This is a huge advantage for providing True mobile broadband connectivity that not only covers metro areas, but also reaches rural areas.
  2. Lightsquared is pursuing a Wholesale only business model – meaning they will not be going up against AT&T, Verizon, etc launching their own retail brand and they will partner with all types of innovative companies looking to connect their customers at 4G speeds anywhere.

Who knows maybe Sprint will partner with Lightsquared to enhance their 4G services.  Regardless, I think Sprint has the opportunity of a lifetime to gain market share and be the only national low cost provider, outside of the metro only providers like Metro PCS, Leap, Cricket, etc.

The KEY ingredient is Bandwidth.  In my opinion, the players that deliver the strongest mobile broadband experience win. The devices coming out have been far ahead of the bandwidth available allowing these devices to really shine.  I believe the FCC will make more spectrum available and innovators like Lightsquared will be successful partnering with all types of companies allowing their customers be be connected anywhere.

I see a BIG opportunity for Entrepreneurs creating Machine to Machine applications that allow devices and machines to connect and communicate via next generation broadband. We will be hosting several upcoming shows on John Martin’s Small Business Roundtable profiling entrepreneurs that are launching innovative M2M technologies.

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