NSA set to acquire AT&T in effort to return profitablity to cloud based services division
WASHINGTON -- NSA (NASDAQ:SPYZ), the world’s largest cloud services provider, has announced plans to acquire AT&T (NYSE:T) in an all cash deal that would create the world's largest telecommunications and networking conglomerate. Analysts say the acquisition was anticipated given the current climate of government/industry consolidation. "NSA has undertaken an aggressive strategy of growth through acquisition and AT&T gives them access to over 100 million wireless customers," according to James Holliway, President of Survey Analytics, a research firm specializing in telecommunications trends. Mr. Holliway added that the move may be a defensive play to maintain market share amid rumors that the CIA is in discussions to purchase online retailer Amazon's web services division.
The deal caps off a turbulent new year for NSA, whose recent entry into the cloud based storage and monitoring business was widely ridiculed due to implementation blunders. NSA hopes to correct these early mistakes by leveraging AT&T's extensive network of call centers in India. "AT&T's ability to appear responsive to clients without actually expending any resources to solve a problem is unparalleled in the industry and exactly what NSA needs if they are going to grow in this competitive market segment," Mr. Holliway explained.
In return, AT&T expects to use NSA's political clout in its ongoing war against net neutrality. AT&T believes equal access interferes with its sovereign right to restrict internet content from those who cannot afford to pay for premium web content such as MySpace.com.
At a press conference today announcing the news, NSA's Media Relations Supplicant, Jay Carney, said, "We are looking forward to AT&T joining the NSA family of companies. Clearly, this demonstrates our willingness to work with our partners in industry to position ourselves more effectively against the best interests of the American public.
Regulators have yet to formally approve the deal, however, approval is viewed mostly as a formality and the two companies have been quietly integrating operations over the last several years. The move positions NSA as the largest telecommunications company in the world, displacing state owned rival China Telecom from the top cloud services provider spot.
Shares of AT&T rose 12% on news of the acquisition.
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