AT&T keeps taking it

A week or so ago I talked about the Economist running full-page AT&T ads in the very same issue in which they bashed the announced AT&T purchase of AT&T.  (For anyone keeping track, I’ve yet to find any more AT&T ads there)  Tonight, while watching Traffic Lights (there’s literally nothing else in my TiVo) I caught one of those ubiquitous T-mobile ads mocking AT&T’s service on the oh-so-trendy iPhone.

Chances are you’ve seen the ad, they’ve been running for months, and I have to admit raised my interest enough to get me to look into their service.  In an homage to Apple, they star two people who declare themselves either an iPhone (a young, good-looking guy with a balding accountant-looking companion) or a T-mobile myTouch 4G (a fetching, girl-next-door, purple-dress wearing Carly Foulkes) in front of a plain white background, who then go on and dialogue about the failings of the former and the superiority of the latter.  The ads vary, but the theme is always that everything you love about the iPhone is weighed down by AT&T (and Verizon in one ad).  T-Mobile is smart in not attacking Apple, cultishly adored for their products’ abilities, but instead the reviled telecoms.  Given T-mobile’s history of winning awards for customer service and customer satisfaction, it’s a good strategy.

Which makes me wonder, why exactly are these ads still running?  The buyout is not a hostile takeover bid, T-Mobile seems to be accepting it (rather Deutsche Telekom, their parent, is eager to offload its poorly placed subsidiary and focus on stronger markets).  If I’m a T-mobile customer, the ad seems to tell me to start looking at Sprint or Verizon, which is bad no matter whether the buyout succeeds.  If I’m a savvy consumer looking for a new phone and carrier (which I am), this ad only cements that it won’t be AT&T and thus it won’t be T-mobile, again lose-lose.

My only idea is that the ads were produced, airtime purchased, and placement approved well before the merger talk.  With nothing else in the stable to replace it with, T-mobile might have thought that the airtime is a sunk cost and the ads might boost their image (and thus the eventual combined value of the AT&T).  The ad certainly isn’t new, so it’s not like this is a new strategy or even an update.  Or maybe there still is internal struggle to remain independent and this is one internal faction’s move to signal the non-inevitableness of the deal.  But maybe it’s just a hedge that the deal will ultimately be blocked by regulators.  Either way, it’ll be interesting to see just how long the ads stay on air.

Media type: TV commercial
From: T-mobile (watched originally on FOX)
Title: not sure
Watch it: 

Ads versus content

I’ve had an iPhone for just over two years now, so you can imagine how eager I am to switch carriers and phones.  In my early research I was leaning towards a smart new up and comer: Samsung’s Galaxy.  The phone itself has some nice features (automatic wifi music sync, no cords necessary) and has been highly reviewed by all the right techies.  Even better was that it was being heavily promoted by T-Mobile, so the discounts would be decent on a cheaper network than the abysmal AT&T.

Assuming you’ve turned on a radio/TV/website in the past week you know where this is going.  I could talk about the crappy state of American telecoms if 4 became 3, the pathetic auctioning of cellular frequencies that will surely be repeated for the 4G services that managed both to not raise much money and to exclude new entrants  (especially compared to Britain’s awesome auction proceeds AND new companies), or the lack of handheld tech innovation we’ll see when Apple et al can only shop their wares at two companies.

Instead I’m going to talk about the Economist.  They wrote a two-page brief on the negative effect this acquisition would have, focusing mainly on rebuffing AT&T’s claims that it would bring infrastructure investment (it didn’t as the Ma Bell monopoly, after a similar promise) and that there still would be regional competitors (consumers focus on national plans, hence AT&T’s marketing campaign about covering 97% of Americans).  As if the Economist wasn’t clear, they dedicated one of their leaders stating just how much they condemned such a deal.  And then, they printed two full-page ads AT&T had bought.

My first thought was: bully for the Economist, not letting advertiser dollars purchase editorial influence.  Afterall, how many of us are brave enough to tell our boss they’re a moron and not to be trusted?  But my second thought was: I wonder if AT&T will buy space in next week’s edition, and why did the Economist take the money?

I know why they took the money, the advertising section is assuredly separate from the editorial staff, I doubt they ever talk (as it should be, to allow independence).  But it would be foolish for AT&T to continue plowing money into a publication that will devote equal copy to their competitors for free.  Of course, that’s not really true, the Economist isn’t arguing that we as consumers shouldn’t buy AT&T, just that their business strategy is harmful.  But in the end, readers of the Economist are going to be more influenced by the articles than the ads, and the telecom’s brand will diminish.  I’d think it’d be better for the company to advertise on more neutral ground: Wired, Foreign Affairs, the Atlantic, etc.  While each of these has published something nasty about AT&T, they do not frequently keep up on on-going stories like the Economist, which surely will carry the AT&T story at every stage.

Case in point: Bahrain.  For months I saw successive ads touting the pro-business, politically-free environment of the Gulf emirate.  And then the Arab Spring started and it wouldn’t matter how many ads King al-Khalifa took out when the Economist covered the riots and editorialized against the government.  AT&T is better served getting its house in order.

Media type: Magazine
From: the Economist
Title: An audacious merger with a poor reception
Read it at: http://www.economist.com/node/18440903?story_id=18440903