AT&T’s bid to buy Leap Wireless, just after SoftBank bought Sprint, and Sprint bought Clearwire, is one sign of potential new consolidation of the U.S. communications and video entertainment markets.
In Europe, Telefonica’s purchase of E-Plus, if approved, would shrink the German market from four leading suppliers to three. If EU regulators approve that deal, most observers expect an upsurge of mergers in the EU market.
In the United Kingdom, Liberty Global has purchased Virgin Media.
In the U.S. cable industry, Liberty Media is talking about eventual consolidation in the U.S. cable business to two leading providers, Comcast and one other entity.
The European Union is pushing to create a single EU telecom market, followed by massive consolidation in the EU telecom business, something service providers have been calling for, and which regulators at the EC seem to agree is needed.
The notion of consolidation leading to a single satellite TV provider, two leading cable companies and eventually, only three national wireless suppliers is in fact possibly too conservative.
In the end, there might be no independent U.S. satellite video business, nor three U.S. mobile service providers, even though there could be regulatory issues.
AT&T’s purchase of Leap Wireless probably will not draw opposition from the Federal Communications Commission, since U.S. market structure would not change. The Leap Wireless assets would not change the market share positions of the top four mobile providers, nor dramatically add subscriber heft for AT&T.
But there has been prior consolidation in most all other U.S. telecom segments as well, including prior rounds of consolidation of mobile, cable, competitive local exchange carriers and long distance providers.
The need for scale, especially when industry segments mature, drove the earlier waves of consolidation. But competition