1/02/2012
12/28/2011
10/17/2011
Air France Logo Gets Makeover (via brandchannel)
Air France Logo Gets Makeover (via brandchannel)
When traveling on Air France, your menu may not be the first thing you look at after boarding the flight. But if you have any interest in design, you might want to check it out.
The company has selected 11 winners to its logo-redesign contest and six of the new versions are being used on some in-flight menus, according to Southalltravel.co.uk. The other five will appear next year. Check out the 6 designs after the jump!
The international competition “challenged designers to come up with a new version of the famous red accent to be used on the in-flight menus,” the site notes. The contest took place between teams from the airline’s design agency, Brandimage, The Financial reports.
Go ahead and keep your eyes peeled because the logos will be “randomly distributed on the airline's flights,” Southall reports. The randomness is “intended to surprise and pique customer curiosity – and possibly spur an interest in collecting the full set,” The Financial notes.
But if you don’t see it, don’t worry. It’s also on display in Air France lounges.
"A palette of bright colors echoing each design is featured on the second and third page covers of Business class menus,” the airline said in a statement. “The typography and layout also reflect the desired spirit of elegance.”
Holidaymakers taking flights to Mumbai or other locations with the carrier may also be pleased to hear that it has been named one of the world's most sustainable in the Dow Jones World Sustainability Index.
When traveling on Air France, your menu may not be the first thing you look at after boarding the flight. But if you have any interest in design, you might want to check it out.
The company has selected 11 winners to its logo-redesign contest and six of the new versions are being used on some in-flight menus, according to Southalltravel.co.uk. The other five will appear next year. Check out the 6 designs after the jump!
The international competition “challenged designers to come up with a new version of the famous red accent to be used on the in-flight menus,” the site notes. The contest took place between teams from the airline’s design agency, Brandimage, The Financial reports.
Go ahead and keep your eyes peeled because the logos will be “randomly distributed on the airline's flights,” Southall reports. The randomness is “intended to surprise and pique customer curiosity – and possibly spur an interest in collecting the full set,” The Financial notes.
But if you don’t see it, don’t worry. It’s also on display in Air France lounges.
"A palette of bright colors echoing each design is featured on the second and third page covers of Business class menus,” the airline said in a statement. “The typography and layout also reflect the desired spirit of elegance.”
Holidaymakers taking flights to Mumbai or other locations with the carrier may also be pleased to hear that it has been named one of the world's most sustainable in the Dow Jones World Sustainability Index.
Tommy Hilfiger Joins DailyFeats for Fashionable Philanthropy (via brandchannel)
Tommy Hilfiger Joins DailyFeats for Fashionable Philanthropy (via brandchannel)
DailyFeats (see video above) professes two beliefs: “change starts with small actions, simple positive choices that people make every day," and "to a create a movement for change, we need the involvement of organizations with strong voices.”
Tommy Hilfiger just signed on to support five feats -- having family fun, calling your parents, walking the dog, riding your bike, and spending an evening at home -- all inspired by the Hilfiger family featured in brand campaigns.
Users earn points by completing feats, and the Hilfiger brand will reward participants with a $10 donation in their name to Millennium Promise, a non-profit organization dedicated to eradicating poverty, to which the Tommy Hilfiger Corporate Foundation announced a $2 million commitment in 2009, or receive $10 off a $50 purchase at tommy.com or in a Tommy Hilfiger specialty store.
"We are very excited to be the first fashion company to join DailyFeats," said Avery Baker, EVP Global Marketing and Communications for Tommy Hilfiger. "DailyFeats is a great reminder that even small contributions can make a very big difference. Every time you walk your dog, call your parents, ride your bike, or spend time at home with the family, that's a moment that Tommy Hilfiger wants you to savor.”
Available for free at for web, iPhone and Android users, DailyFeats lets users post their feats via SMS, web, email, Foursquare or Google Talk. The more feats a user posts, the broader their social identity is on the site. Participants pick categories near and dear to their hearts like “health,” “family” or “citizenship,” adding a layer of philanthropy to personal profiles.
The site works on the honor system. “All of the actions are self-reported. A great majority of them are fundamentally impossible to check…So how do you prevent your user base from gaming the system just to get a discount somewhere?” asked Mashable.
“We trust our members,” said DailyFeats CEO and co-founder Veer Gidwaney.
DailyFeats (see video above) professes two beliefs: “change starts with small actions, simple positive choices that people make every day," and "to a create a movement for change, we need the involvement of organizations with strong voices.”
Tommy Hilfiger just signed on to support five feats -- having family fun, calling your parents, walking the dog, riding your bike, and spending an evening at home -- all inspired by the Hilfiger family featured in brand campaigns.
Users earn points by completing feats, and the Hilfiger brand will reward participants with a $10 donation in their name to Millennium Promise, a non-profit organization dedicated to eradicating poverty, to which the Tommy Hilfiger Corporate Foundation announced a $2 million commitment in 2009, or receive $10 off a $50 purchase at tommy.com or in a Tommy Hilfiger specialty store.
"We are very excited to be the first fashion company to join DailyFeats," said Avery Baker, EVP Global Marketing and Communications for Tommy Hilfiger. "DailyFeats is a great reminder that even small contributions can make a very big difference. Every time you walk your dog, call your parents, ride your bike, or spend time at home with the family, that's a moment that Tommy Hilfiger wants you to savor.”
Available for free at for web, iPhone and Android users, DailyFeats lets users post their feats via SMS, web, email, Foursquare or Google Talk. The more feats a user posts, the broader their social identity is on the site. Participants pick categories near and dear to their hearts like “health,” “family” or “citizenship,” adding a layer of philanthropy to personal profiles.
The site works on the honor system. “All of the actions are self-reported. A great majority of them are fundamentally impossible to check…So how do you prevent your user base from gaming the system just to get a discount somewhere?” asked Mashable.
“We trust our members,” said DailyFeats CEO and co-founder Veer Gidwaney.
8/28/2011
5/04/2011
3/25/2011
Mercedes-Benz Makes a Safe Bet on Teens (via brandchannel)
Mercedes-Benz Makes a Safe Bet on Teens (via brandchannel)
Mercedes-Benz Makes a Safe Bet on Teens
Posted by Dale Buss on March 24, 2011 04:00 PM
Few of the students will ever get to own a Mercedes-Benz, but the German luxury auto maker has decided to launch a teen-driving school in the United States. It’s an interesting brand extension at a time when the top segment of the U.S. market has gotten more competitive than ever.
Maybe Mercedes-Benz executives just figure their predecessors are the ones that first foisted cars on the world over a century ago, so they’ve got a responsibility to make driving safer. Certainly, they’re looking at the success they’ve already had with a similar school in the UK.
But in announcing its plans this week to brings its Mercedes-Benz Driving Academy to the US, the company says it feels a sense of responsibility for helping to reduce the high incidence of inattentive driving and accidents among American teenagers and knocked the unimproved state of “driver’s ed.”
“Despite the dramatic changes in vehicles, highways, and the driving environment over the past 60 years, driver education remains relatively unchanged in the U.S.,” stated Alexander Hobbach, senior manager at Daimler AG.
“The skills required to simply get a license do not fully prepare young drivers to meet the demands of the road. Mercedes-Benz recognizes this issue and as a result is creating an educational program for the U.S. that is based on the best teaching methods and tools available.”
Although the company didn’t say specifically how it plans to address the issue, surely the rising problem of texting teens and distracted driving — which has been targeted by federal regulators and conceded by other auto makers — has to be high on the list for “German re-engineering” of how teenagers drive.
Mercedes-Benz provided few details for its plans or methods for the US school, although its press release does note that the instructional framework will include the notion of “restricted driving privileges once a novice driver starts driving solo.”
That sort of thing isn’t exactly likely to endear American teens to the Mercedes-Benz program, although it could be welcomed by their parents paying for the program. Then again, maybe that’s the point.
More about: Mercedes-Benz, Automotive, Education, Brand Extensions, Luxury, Teens, US
Mercedes-Benz Makes a Safe Bet on Teens
Posted by Dale Buss on March 24, 2011 04:00 PM
Few of the students will ever get to own a Mercedes-Benz, but the German luxury auto maker has decided to launch a teen-driving school in the United States. It’s an interesting brand extension at a time when the top segment of the U.S. market has gotten more competitive than ever.
Maybe Mercedes-Benz executives just figure their predecessors are the ones that first foisted cars on the world over a century ago, so they’ve got a responsibility to make driving safer. Certainly, they’re looking at the success they’ve already had with a similar school in the UK.
But in announcing its plans this week to brings its Mercedes-Benz Driving Academy to the US, the company says it feels a sense of responsibility for helping to reduce the high incidence of inattentive driving and accidents among American teenagers and knocked the unimproved state of “driver’s ed.”
“Despite the dramatic changes in vehicles, highways, and the driving environment over the past 60 years, driver education remains relatively unchanged in the U.S.,” stated Alexander Hobbach, senior manager at Daimler AG.
“The skills required to simply get a license do not fully prepare young drivers to meet the demands of the road. Mercedes-Benz recognizes this issue and as a result is creating an educational program for the U.S. that is based on the best teaching methods and tools available.”
Although the company didn’t say specifically how it plans to address the issue, surely the rising problem of texting teens and distracted driving — which has been targeted by federal regulators and conceded by other auto makers — has to be high on the list for “German re-engineering” of how teenagers drive.
Mercedes-Benz provided few details for its plans or methods for the US school, although its press release does note that the instructional framework will include the notion of “restricted driving privileges once a novice driver starts driving solo.”
That sort of thing isn’t exactly likely to endear American teens to the Mercedes-Benz program, although it could be welcomed by their parents paying for the program. Then again, maybe that’s the point.
More about: Mercedes-Benz, Automotive, Education, Brand Extensions, Luxury, Teens, US
3/24/2011
The Measurement Menaces of the Month: People who Perpetuate the Myth that There Is One Simple Answer to Social Media ROI. - The Measurement Standard: Blog Edition
The Measurement Menaces of the Month: People who Perpetuate the Myth that There Is One Simple Answer to Social Media ROI. - <i>The Measurement Standard: Blog Edition</i>
« Matt Kelly and Dustin Supra are the Measurement Mavens of the Month | Main
March 24, 2011
The Measurement Menaces of the Month: People who Perpetuate the Myth that There Is One Simple Answer to Social Media ROI.
As I’ve said elsewhere recently, there is no single easy answer to social media ROI measurement. Right now there are at least half a dozen august bodies trying to define a standard. Which, so far, has meant at least six different standards. (See The Paine of Measurement in this month’s issue.)
ROI Does Not Mean “Results”
To make matters much worse, the term ROI is very commonly misused to mean “whatever you get for your efforts.” One more time for the record: ROI is a standard accounting calculation meaning “percent return on a financial investment.”
The disheartening tendency to misdefine the term ROI causes confusion and miscommunication. Especially between the people who use it incorrectly and the board room. Who definitely do not use it incorrectly. (See, for instance, “The Dumbing-Down of "ROI:" Shel Holtz Makes Sense of It”.)
A recent study by Tom Watson, Professor of PR at The Media School at Bournemouth University in the UK, found that 66% of PR people he surveyed used the term regularly but only 14% used it in the context of financial objectives. (Download WatsonROIpaperIPRRC2011) In fact, among the PR professionals he surveyed, 64% didn't think there should be a standard definition of ROI! Even worse, about 10% said they used an AVE-based formula. Talk about menaces!
Those who try to dumb down social media ROI do themselves and the industry no favors. For a particularly egregious example, take Mia Iverson’s attempt to tackle social media ROI. Her “formula” for ROI calculation is not even remotely related to real ROI. And to put initials around it doesn’t change that fact. (Honestly, Mia, “SMROI?” It sounds like something you would eat around a campfire. I’d love to see your COO or CFO’s reaction.)
Mia uses tweets and likes for the “R” in ROI. She suggests that you take the “desired action” (the likes or click throughs) and divide by the total impressions. To quote: “...you can take your number of followers [impressions] and the number of click throughs [desired actions] and calculate your ROI accordingly. Problem solved.”
WTF?
ROI is Not That Simple
My point here is not to dump on Mia or blame her or anyone else struggling to simplify metrics. My point is that it’s just not that easy. The elusive ROI Magic Formula is not going to be discovered by just picking up a couple of numbers that are lying around the Internet. As with anything else, it’s Garbage In, Garbage Out. If you aren’t willing to do some hard work up front, you will get garbage for metrics. I can’t say it better than Amber Naslund already has.
So, folks, calculations like Mia’s are like trying to get to the moon on a tricycle. Yes, it’s a lot easier to ride a tricycle, but it really doesn’t get you anywhere close. Next time someone tries to feed you a simple ROI calculation for social media, please congratulate them on being a Measurement Menace of the Month. —KDP
A really big thanks to Tom Humbarger for the Oreo cookie illustration.
« Matt Kelly and Dustin Supra are the Measurement Mavens of the Month | Main
March 24, 2011
The Measurement Menaces of the Month: People who Perpetuate the Myth that There Is One Simple Answer to Social Media ROI.
As I’ve said elsewhere recently, there is no single easy answer to social media ROI measurement. Right now there are at least half a dozen august bodies trying to define a standard. Which, so far, has meant at least six different standards. (See The Paine of Measurement in this month’s issue.)
ROI Does Not Mean “Results”
To make matters much worse, the term ROI is very commonly misused to mean “whatever you get for your efforts.” One more time for the record: ROI is a standard accounting calculation meaning “percent return on a financial investment.”
The disheartening tendency to misdefine the term ROI causes confusion and miscommunication. Especially between the people who use it incorrectly and the board room. Who definitely do not use it incorrectly. (See, for instance, “The Dumbing-Down of "ROI:" Shel Holtz Makes Sense of It”.)
A recent study by Tom Watson, Professor of PR at The Media School at Bournemouth University in the UK, found that 66% of PR people he surveyed used the term regularly but only 14% used it in the context of financial objectives. (Download WatsonROIpaperIPRRC2011) In fact, among the PR professionals he surveyed, 64% didn't think there should be a standard definition of ROI! Even worse, about 10% said they used an AVE-based formula. Talk about menaces!
Those who try to dumb down social media ROI do themselves and the industry no favors. For a particularly egregious example, take Mia Iverson’s attempt to tackle social media ROI. Her “formula” for ROI calculation is not even remotely related to real ROI. And to put initials around it doesn’t change that fact. (Honestly, Mia, “SMROI?” It sounds like something you would eat around a campfire. I’d love to see your COO or CFO’s reaction.)
Mia uses tweets and likes for the “R” in ROI. She suggests that you take the “desired action” (the likes or click throughs) and divide by the total impressions. To quote: “...you can take your number of followers [impressions] and the number of click throughs [desired actions] and calculate your ROI accordingly. Problem solved.”
WTF?
ROI is Not That Simple
My point here is not to dump on Mia or blame her or anyone else struggling to simplify metrics. My point is that it’s just not that easy. The elusive ROI Magic Formula is not going to be discovered by just picking up a couple of numbers that are lying around the Internet. As with anything else, it’s Garbage In, Garbage Out. If you aren’t willing to do some hard work up front, you will get garbage for metrics. I can’t say it better than Amber Naslund already has.
So, folks, calculations like Mia’s are like trying to get to the moon on a tricycle. Yes, it’s a lot easier to ride a tricycle, but it really doesn’t get you anywhere close. Next time someone tries to feed you a simple ROI calculation for social media, please congratulate them on being a Measurement Menace of the Month. —KDP
A really big thanks to Tom Humbarger for the Oreo cookie illustration.
3/22/2011
東京電力供給エリアのマクドナルド店舗営業時間に関する運用変更のお知らせ
McDonald Japan resumes its service around Japan including Sendai City. 24 Hour services are also available at designated stores.
対象店舗 － 3月21日（月）までの24時間営業は20店舗 → 3月22日（火）から204店舗
※23日（水）から沼田インター店を追加し計205店舗
東京都 70店舗 Tokyo
神奈川県 37店舗 Kanagawa
千葉県 19店舗 Chiba
埼玉県 17店舗 Saidama
群馬県 15店舗 kunma
茨城県 11店舗
栃木県 18店舗
山梨県 6店舗 Yamaishi
静岡県 12店舗
対象店舗 － 3月21日（月）までの24時間営業は20店舗 → 3月22日（火）から204店舗
※23日（水）から沼田インター店を追加し計205店舗
東京都 70店舗 Tokyo
神奈川県 37店舗 Kanagawa
千葉県 19店舗 Chiba
埼玉県 17店舗 Saidama
群馬県 15店舗 kunma
茨城県 11店舗
栃木県 18店舗
山梨県 6店舗 Yamaishi
静岡県 12店舗
Scientists: Radiation in Japan food poses low risk
By Rita Rubin and Dan Vergano, USA TODAY
Health risks to Japanese from eating foods contaminated with elevated levels of radiation are fairly low, scientists say.
The Japanese government has found radiation levels "significantly above" acceptable levels in milk, spinach and kakina, another leafy vegetable, produced near the damaged Fukushima Dai-ichi Nuclear Power Station, the International Atomic Energy Agency said Monday. Yet the government says the levels are still low enough that they pose no immediate threat to human health.
Still, because the radiation levels are above legal limits, the government has banned distribution of milk from Fukushima Prefecture and spinach and kakina from Fukushima and three other prefectures.
"Even if you eat contaminated vegetables several times, it will not harm your health at all," Chief Cabinet spokesman Yukio Edano said in the Japanese government's latest appeal to ease public concerns.
Fred Mettler, a University of New Mexico radiologist who led a United Nations-sponsored team investigating the health effects of the 1986 Chernobyl nuclear disaster, said he didn't expect to see any detectable increase in cancer risk from consumption of radiation-contaminated foods in Japan, let alone in the USA.
Radioactive iodine gets into milk 12 hours after cows eat contaminated grass, Mettler said. More than two decades after the Chernobyl reactor explosion in Ukraine, Mettler said, the only detectable increases in cancer cases attributed to it are thyroid cancers. Those cancers have occurred in people who were children or teens at the time of the accident and drank milk from cows that ate grass in the thousands of square miles contaminated with radioactive iodine.
In Japan, it's not surprising that spinach is the main vegetable found contaminated, because it's an early spring crop whose large leaves can catch falling radiation, said Robert Buchanan, director of the Center for Food Safety and Security Systems at the University of Maryland.
Both Mettler and Buchanan noted that virtually all foods contain radioactivity collected from cosmic sources and bits of uranium in soil.
After a massive 9.0 earthquake and ensuing tsunami devastated Japan, many are turning to different aid groups to offer assistance. Here are some organizations where you can get involved:
Americans need not worry about consuming food produced near the Fukushima plant, Mettler, Buchanan and the Food and Drug Administration say.
Only about 4% of all food imported to the USA comes from Japan, and dairy products make up only 0.1% of all FDA-regulated products imported from Japan, according to the agency.
"Because of the heavy damage caused by the earthquake and tsunami to the region, no products are currently being exported from the affected area," according to the FDA.
Meanwhile, engineers hit a new setback Monday in their attempts to control the overheated nuclear reactors and pools of spent fuel rods at the Fukushima Dai-ichi Nuclear Power Station. Smoke poured from two areas of the spent-fuel-rod pools, for reasons still unknown, and forced workers to evacuate temporarily.
On their return, engineers continued pumping seawater to cool down three crippled nuclear reactors, and firetrucks refilled water in the spent-fuel-rod pools in the two buildings. Power had been partly reconnected to all six reactors at the plant, according to the Tokyo Electric Power Co.
"Conditions are improving across the board," said nuclear engineer David Lochbaum of the Union of Concerned Scientists. "But it is still very challenging."
Damaged pumps and other equipment have slowed repairs, as has the need to insulate electrical repair work from the water spraying. Hidehiko Nishiyama of Japan's Nuclear and Industrial Safety Agency suggested full repairs could take weeks.
Also Monday, a teacher from Virginia was identified as an American victim of the tsunami.
The family of Taylor Anderson, 24, said in a statement that the U.S. Embassy in Japan called to say her body was found in the city of Ishinomaki. Jean Anderson said her daughter was last seen after the earthquake riding her bike away from an elementary school after making sure parents picked up their children.
Contributing: The Associated PressCopyright 2011 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.
For Consumers, Little to Cheer in AT&T Deal
By JENNA WORTHAM
Published: March 21, 2011
Richard Perry/The New York Times
AT&T's acquisition of T-Mobile could improve service and network quality for both carriers' customers, but analysts say it could also push prices higher.
Multimedia
Richard Perry/The New York Times
A T-Mobile store in Manhattan.
If approved by regulators, the merger would leave just three major cellular carriers in the United States, a development that consumer advocates warn could eventually lead to higher prices for a wide variety of services. For this reason the deal is likely to attract close scrutiny in Washington.
It is too early to say how much — or even whether — rates might rise for consumers, who on average pay $55 a month for their wireless plans, said Roger Entner, who tracks the wireless industry for the Nielsen Company. But while consumers may see some immediate benefits — in network quality, for example — they are not likely to benefit in the long run, some analysts and industry experts said.
The bottom line, they said, is that competition is likely to suffer, leading to higher prices and less innovation. That is because the deal would leave just AT&T, Verizon Wireless and the much smaller Sprint to divide up the voracious smartphone market — with the AT&T and T-Mobile union likely to dominate the market.
“Without some of the smaller competitors, you won’t have the competitive pressure that leads to lower prices and innovations and offerings among the carriers,” said Paul Reynolds, electronics editor at Consumer Reports.
AT&T maintains that the merger will be good for consumers.
“The benefits of this transaction are possible at this scale and on this timeline only from the combination of these two companies,” Randall L. Stephenson, chairman and president of AT&T, said in a call to investors and analysts on Monday. He added that the merger “will improve network quality” and “give more customers access to more services.”
Other analysts also had a rosier view, suggesting that AT&T may diversify its offerings if it acquires T-Mobile. T-Mobile has long built its reputation by offering affordable, low-rate cellphone plans, including ones that do not require annual contracts or a minimum voice plan.
“Having 30 million new subscribers might convince them to add more attractive data pricing,” said Chetan Sharma, an independent wireless analyst, referring to T-Mobile’s customer base. “Things like data family plans could become a reality.”
Whatever happens to prices, the availability of cellphone coverage in the United States is likely to expand, analysts said. AT&T and T-Mobile have invested in different parts of the country, and customers of the two companies would have access to a larger, combined network. Potentially, the acquisition of T-Mobile, with its additional wireless spectrum, could also help AT&T with the rollout of its next-generation wireless network, known as 4G.
Improved service and network quality could be another boon. T-Mobile and AT&T use the same underlying GSM cellphone technology, which should reduce any friction of blending the two networks. AT&T could take advantage of T-Mobile’s latest high-speed network, in which the company has invested millions to upgrade and bring online. By adding T-Mobile, AT&T will gain cell sites equivalent to the number it would have taken five years to build, experts say. All this means, in theory at least, that service should improve. But the cost to buy that coverage is likely to go up.
“Typically, the more competition there is, the faster prices drop,” Mr. Sharma said. “In a situation where there are two main carriers, pricing is not likely to move as much.”
One burning question raised by the potential of a merger with AT&T is what will happen to the wide range of inventive T-Mobile data plans, which are some of the lowest in the country, and have helped keep pressure on competitors. The company also offers a wider choice of smartphones for younger users, like the popular Sidekick line, which T-Mobile recently said it would revive.
AT&T is expected to honor contracts through their expirations, but it is unclear what will happen once those contracts expire.
“The prospect of having those kinds of options go away is a real concern,” said Mr. Reynolds of Consumer Reports. “It’s a welcome offering for people in this market that can be quite unaffordable otherwise.”
If approved, the merger is expected to save both companies $3 billion annually. That saving, Mr. Sharma said, along with the influx of millions of new consumers, might persuade the company to be more competitive in family data plans as a way to draw in new subscribers and increase competition with Verizon, the new company’s chief rival. If the merger is approved, AT&T would have about 129 million wireless customers and Verizon about 101 million. Sprint has about 50 million customers.
Another potential byproduct could be a drop in pricing for sleek, high-end smartphones. Hardware makers, for example, might offer AT&T a lower rate for bulk purchases of new smartphones and tablet computers.
“AT&T’s new scale would give them pricing advantage,” Mr. Sharma said. “You could end up seeing $100 or $150 smartphones for consumers in the future.” A typical smartphone can cost $200 with a contract. One constant in a consumer’s life could remain: frustrating experiences with customer service.
“In terms of customer satisfaction, AT&T was clearly in last place, below average in comparison to other carriers, including T-Mobile,” he said.
Although T-Mobile has historically performed well in the annual surveys conducted by Consumer Reports that rate satisfaction, in big takeovers the larger company typically tends to swallow the smaller one, he said.
“The overall consumer experience might become more like AT&T than T-Mobile,” Mr. Sharma said.
It is too early to say how much — or even whether — rates might rise for consumers, who on average pay $55 a month for their wireless plans, said Roger Entner, who tracks the wireless industry for the Nielsen Company. But while consumers may see some immediate benefits — in network quality, for example — they are not likely to benefit in the long run, some analysts and industry experts said.
The bottom line, they said, is that competition is likely to suffer, leading to higher prices and less innovation. That is because the deal would leave just AT&T, Verizon Wireless and the much smaller Sprint to divide up the voracious smartphone market — with the AT&T and T-Mobile union likely to dominate the market.
“Without some of the smaller competitors, you won’t have the competitive pressure that leads to lower prices and innovations and offerings among the carriers,” said Paul Reynolds, electronics editor at Consumer Reports.
AT&T maintains that the merger will be good for consumers.
“The benefits of this transaction are possible at this scale and on this timeline only from the combination of these two companies,” Randall L. Stephenson, chairman and president of AT&T, said in a call to investors and analysts on Monday. He added that the merger “will improve network quality” and “give more customers access to more services.”
Other analysts also had a rosier view, suggesting that AT&T may diversify its offerings if it acquires T-Mobile. T-Mobile has long built its reputation by offering affordable, low-rate cellphone plans, including ones that do not require annual contracts or a minimum voice plan.
“Having 30 million new subscribers might convince them to add more attractive data pricing,” said Chetan Sharma, an independent wireless analyst, referring to T-Mobile’s customer base. “Things like data family plans could become a reality.”
Whatever happens to prices, the availability of cellphone coverage in the United States is likely to expand, analysts said. AT&T and T-Mobile have invested in different parts of the country, and customers of the two companies would have access to a larger, combined network. Potentially, the acquisition of T-Mobile, with its additional wireless spectrum, could also help AT&T with the rollout of its next-generation wireless network, known as 4G.
Improved service and network quality could be another boon. T-Mobile and AT&T use the same underlying GSM cellphone technology, which should reduce any friction of blending the two networks. AT&T could take advantage of T-Mobile’s latest high-speed network, in which the company has invested millions to upgrade and bring online. By adding T-Mobile, AT&T will gain cell sites equivalent to the number it would have taken five years to build, experts say. All this means, in theory at least, that service should improve. But the cost to buy that coverage is likely to go up.
“Typically, the more competition there is, the faster prices drop,” Mr. Sharma said. “In a situation where there are two main carriers, pricing is not likely to move as much.”
One burning question raised by the potential of a merger with AT&T is what will happen to the wide range of inventive T-Mobile data plans, which are some of the lowest in the country, and have helped keep pressure on competitors. The company also offers a wider choice of smartphones for younger users, like the popular Sidekick line, which T-Mobile recently said it would revive.
AT&T is expected to honor contracts through their expirations, but it is unclear what will happen once those contracts expire.
“The prospect of having those kinds of options go away is a real concern,” said Mr. Reynolds of Consumer Reports. “It’s a welcome offering for people in this market that can be quite unaffordable otherwise.”
If approved, the merger is expected to save both companies $3 billion annually. That saving, Mr. Sharma said, along with the influx of millions of new consumers, might persuade the company to be more competitive in family data plans as a way to draw in new subscribers and increase competition with Verizon, the new company’s chief rival. If the merger is approved, AT&T would have about 129 million wireless customers and Verizon about 101 million. Sprint has about 50 million customers.
Another potential byproduct could be a drop in pricing for sleek, high-end smartphones. Hardware makers, for example, might offer AT&T a lower rate for bulk purchases of new smartphones and tablet computers.
“AT&T’s new scale would give them pricing advantage,” Mr. Sharma said. “You could end up seeing $100 or $150 smartphones for consumers in the future.” A typical smartphone can cost $200 with a contract. One constant in a consumer’s life could remain: frustrating experiences with customer service.
“In terms of customer satisfaction, AT&T was clearly in last place, below average in comparison to other carriers, including T-Mobile,” he said.
Although T-Mobile has historically performed well in the annual surveys conducted by Consumer Reports that rate satisfaction, in big takeovers the larger company typically tends to swallow the smaller one, he said.
“The overall consumer experience might become more like AT&T than T-Mobile,” Mr. Sharma said.
3/21/2011
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