A Foolish Week of Telecom

Updated

The so-called "duopoly" of U.S. mobile carriers, Verizon and AT&T, as well as the recently strengthened No. 3 carrier Sprint Nextel, should gird themselves for the possibility of yet another competitor.

The Wall Street Journal is reporting Google and DISH Network have been discussing working together on a new national wireless network, according to people with knowledge of the talks.

Have cell phone sales peaked?
Worldwide sales of cell phones have declined 3.1% in the third quarter compared to the same period last year, says technology research firm Gartner. There is some good news in there for mobile phone makers: Smartphone sales, which made up 39.6% of the 428 million phones sold during Q3, increased by 46.9% over last year's third quarter.


"In China, sales of mobile phones grew driven by sales of smartphones, while demand of feature phones remained weak. In mature markets, we finally saw replacement sales pick up with the launch of new devices in the quarter," said Gartner research analyst Anshul Gupta.

It shouldn't come as a surprise that the two giants in smartphone sales were Samsung and Apple with a combined lock on 46.5% of that market, according to Gartner. The once-mighty Nokia no longer holds third place. It only took from Q2 2011 to Q3 2012 for Nokia to have plunged to seventh.

Microsoft in the middle
For those smartphone users (or would-be users), who aren't comfortable with the relatively loose parenting of the Android worlds, but also don't want to be under the thumb of Apple's iOS wardens, Microsoft has got the ecosystem for you -- at least according to Microsoft CEO Steve Ballmer.

At a tech industry event this week, Ballmer said the mobile OS ecosystem offering the best of both worlds is none other than Microsoft's own Windows Phone 8.

"The ecosystem for Android is little bit wild," Balmer said, according to AllThingsD. "We have a customer set that wants an alternative," between that and the tightly controlled Apple system, he said.

Any problems for the MetroPCS/T-Mobile merger?
None at all, MetroPCS CFO Braxton Carter told a Morgan Stanley investor conference. The shareholders, he said, are totally behind the deal, Reutersreported.

"We think it is the right transaction, and we are confident our shareholders will approve it. There are massive synergies from this, the creation of a value player with a multi-segment strategy," he said.

Samsung's revenge
Maybe it was inevitable that the legal battles royale that Samsung and Apple are engaged in around the world would lead to Samsung upping the price of the chips it sells to Apple.

According to Korean news site Chosun Ilbo, Samsung has raised the price 20% for the application processor chips it sells to Apple for its mobile devices. Last year Apple bought 130 million of the processors, and this year it is expected that will rise to 200 million.

AT&T downgraded again
Fitch Ratings has downgraded AT&T's credit rating this week, lowering it from stabile to negative. The agency cited AT&T's recently announced capital expenditures and the company's stock repurchasing plan as reasons for its raised eyebrows.

Last week it was Moody's looking askance at the carrier's spending, putting it under review for a lowered rating. Moody's, as well as Fitch, didn't like the increased debt-to-EBITDA ratio the expenditures would incur.

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The article A Foolish Week of Telecom originally appeared on Fool.com.

Fool contributor Dan Radovsky owns shares of AT&T and Nokia. The Motley Fool owns shares of Apple, Google, and Microsoft. Motley Fool newsletter services recommend Apple, Google, Moody's, Microsoft, and AT&T. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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