AT&T CEO promises improved service with merger

Excerpts from the blog

RANCHO PALOS VERDES, Calif. — Ralph de la Vega, chief executive of AT&T Mobility, defended his company's plans to acquire Bellevue-based T-Mobile USA and promised that it will improve service for customers.

Walt Mossberg and Kara Swisher, hosts of the All Things D 9 conference who interviewed de la Vega on stage, didn't seem overly impressed.

Swisher said she recently switched to Verizon — for a white iPhone.

Mossberg questioned why people should trust AT&T's promises about the merger when the company consistently ranks low on customer-satisfaction surveys.

De la Vega said the company's first quarter results "speak for themselves." At the same time a competitor was launching an iPhone, AT&T reported the best quarter of iPhone sales and net customer additions in the company's history.

The merger is driven in part by the huge increase in data usage on its network, which has increased 8,000 percent over the last four years.

"When we merge the networks of both companies and overlay our network to their network, it improves the quality and capacity for both customers," he said.

In dense cities like New York and San Francisco, the combination will provide a service improvement equivalent to five to 10 years of adding new cell sites, he said.

De la Vega also argued that the wireless market is competitive and will remain so after the merger, but that's the $39 billion question federal regulators will have to answer over the next year. On Tuesday, Sprint filed its formal objection to the merger.

Mossberg asked about Sprint's contention that it will be "killed" by the merger.

"I think Sprint has done well in this environment. They're going to continue to do well; they're going to continue to innovate," he said, adding that Sprint and Clearwire together have more spectrum than any other carrier.

Mossberg scoffed at that, saying Sprint and Clearwire aren't in sync and compete with each other, even though Sprint is the majority owner of Clearwire.

De la Vega is a veteran of BellSouth who was chief operating officer of Cingular Wireless through its merger with AT&T Wireless in 2004.

Moving past the merger, Swisher asked about the rise of the Apple and Google phone platforms.

"Our view has been from the get-go, we want to give customers the choice ... we will let the customers decide which one they will participate" with, he said.

Asked about the role of the carrier amid the rise of mobile-device ecosystems like Apple's and Google's, de la Vega said carriers enable the innovation.

In the future, carriers and device makers will need to collaborate more, he said. The company has already done this with Apple — providing it with specs to develop the first iPhone — and with Microsoft, with which it developed AT&T's Internet-delivered television service.

Discussing monthly vs. pay-as-you-go data plans for tablets, smartphones and other devices, de la Vega said AT&T is considering new shared data plans that would work with multiple devices.

"I think once you have so many devices that you're carrying, you may want a shared plan ... ," he said. "The more focus groups that we do, the more we think that may be the way."

When will it appear?

"I think it will be soon," he said.

During a question session, de la Vega was asked about renewed concerns about the cancer risk of wireless phones, as called out this week by the World Health Organization (WHO), and how it will affect the industry.

De la Vega said the WHO is "a very valid body to look at this," but it drew on an earlier report that's been out for a year.

"The industry shouldn't have too much too worry (about); nevertheless we should continue to study the matter," he said.

Digital Disney

New digital platforms are a huge opportunity for Disney and other content companies, Disney Chief Executive Bob Iger said at the All Things D conference.

During an interview with co-host Kara Swisher, Iger said the arrival of the video playing iPod was a revelation about the potential of portable devices.

With some 450 million smart devices expected to be sold next year, Disney has even more opportunities to monetize its content.

"Those are media players, every one of them, whether they're a smartphone or a tablet, they're media players," he said.

Netflix and Hulu are also helping Disney, but the company simultaneously is working on an overhaul of Disney.com that will include new video services. Iger said it will likely include a mix of advertising, pay-per-view and microtransactions and launch within a year.

Having content available conveniently on new platforms is also a way to find content piracy, he said.

Disney is also thinking about developing its own child- and family-oriented social network tied to Disney.com, although Iger said the company's doing well with Facebook, where more than 180 million users are members of various Disney sites.

When pressed on the subject, Iger said he didn't want people to have the impression the company's about to launch a social network for kids. "We may do that at some point but it's not imminent," he said

Swisher asked whether Disney has a special relationship with Apple because Steve Jobs is Disney's largest shareholder. Iger said he's had a relationship with Jobs that goes back to Disney buying Pixar from him, but their companies have an "arm's length" relationship.

"The company doesn't have a special relationship with Apple," he said, adding that "We've not said yes to everything Apple's wanted and vice versa."

Asked by Swisher about 3-D, Iger said "it's way too early to write 3-D's epitaph" but the format "has to be used in smart ways."

"It has to be used carefully. It has to be used on the right film and in the right way creatively and technologically," he said, adding that "Lion King" will be released in 3-D later this year.

Brier Dudley's blog excerpts appear Thursdays. Reach him at 206-515-5687 or bdudley@seattletimes.com.