I cannot think of the last time that I heard about a billion dollar Merger or Acquisition of a telecommunications company in the United States (US). Whether we are talking about an Asset Purchase, Stock Purchase, a Tender Offer, or a Hostile Take Over bid there seems to be no M&A activity in the U.S. telecommunications sector. On the other hand, in Asia and developing countries, M&A Activity in telecom is still hot!
In Mexico, American Movil acquired Carso Global Telecom for around twenty five and a half billion dollars. GTL Infrastructure acquired Tower Portfolio for about 2 billion dollars in India. So, it begs the question, what is going on with the telecommunications industry in the U.S.? Is it stricter Antitrust regulations? More conservative executives? Reluctance to take risks in the U.S.? Insufficient growth?
Of course, every M&A deal has business objectives driving the parties decisions. So, perhaps, there just is no need for the following: additional revenue streams; market share; new product development; untapped customers; or opportunity for growth in the U.S. telecommunications market. I refuse to accept or believe that these are the reasons behind the lack of M&A activity in the U.S. telecommunications industry.
Frankly, there is still growth in the following areas: the 4G market, the prevalence of viral marketing, the increasing use of smart phones for accessing the internet, gaming technology for phones, cloud computing and the list goes on and on. Of course, there is a greater number of consumers that have never used the internet or smart phones in Asia and the developing markets.
However, the U.S. appetite for new ways to communicate, share information, play games, share files and entertain ourselves is still on the rise. Thus, it is only a matter of time before M&A picks up in the U.S. I for one am looking forward to the pick up and looking forward to 5G technology.