Greetings from Missouri and Iowa, home to two football rivalries: the CyHawk series between Iowa State and the University of Iowa, and the ever-intense cross-border rivalry between KU and Mizzou. We are very thankful that college football has returned – wouldn’t be fall without it.
There’s been a surprisingly large amount of news to cover in the last two weeks (what Labor Day holiday?). We will cover as much of the news as 2300 words will allow with a focus on macroeconomic data, the Google Antitrust remedy, and thoughts on the T-Mobile/ US Cellular synergy announcement.
The Fortnight That Was
Over the last two weeks, the Fab Five gained $466 billion in market capitalization while the Telco Top Five gained $3 billion. So far in 2025, the Telco Top Five have gained $1.49 trillion while the Telco Top Five have gained $79 billion. Apple remains the only Fab Five stock that has lost value in 2025, joining Comcast and Charter in the Telco Top Five as decliners. Google (thanks in large part to Judge Mehta’s remedy ruling discussed below) and Microsoft have each gained ~$550 billion in value in 2025 while AT&T (+$49 billion) and T-Mobile (+$37 billion) lead the way for the Telco Top Five. Verizon remains much more valuable ($26 billion to be exact) than the combined value of Comcast + Charter. Verizon trails AT&T in market cap, however by $25 billion (13.4%).
The monthly jobs report was the headline economic indicator for the week with job growth sluggish (nonfarm payrolls +22,000) and the unemployment rate rising to 4.3% (full release here). One of the reasons citied by economists for the sluggish growth is the Trump administration’s immigration policy. We pulled the data from Table A-7 of Friday’s report to determine the year-over-year impact. In the last year, employment for foreign-born individuals dropped by 822K while that same figure for the native-born population grew by 2.8 million (see highlighted figures in the nearby table).
In addition, the unemployment rate for foreign-born men grew from 3.5% in August 2024 to 4.1% in August 2025, while the same figures for native-born men declined from 4.4% to 4.3% (interestingly, these trends are reversed for women). Overall, the civilian labor force (-2.5%), participation rate (-0.8%), employed persons (-2.6%), and employment to population ratio (-1.3%) measures have all declined for foreign-born individuals. The civilian labor force (+2.3%) and total employed (+2.2%) have increased for the native-born population.
We thought it would be interesting to pull these same figures for August 2019 to provide a pre-COVID look at the employment picture in the first Trump administration. They are shown in the last two columns of the nearby table. The most intriguing piece of data is that from August 2019 to August 2024, the number of native-born employed dropped by 833K. By August 2025, that figure had shifted to a gain of 1.9 million. Foreign-born comparable figures are +4.4 million for the 2019-2024 period and +3.5 million for the 2019-2025 period.
What we don’t know is the rate differential paid (if any) between the two segments. We can safely say, however, that the pendulum is shifting away from foreign-born employment to native-born. The hypothesis that the positions previously held by foreign-born individuals would not be filled by native-born individuals is not true, but we don’t know what wage demands had to be met to fill those positions.
Why does this matter to telecom? Immigration is frequently cited by Telco Top Five CEOs and CFOs as a reason for slowing gross additions in 2025. With the foreign-born population dropping and the employed population dropping even more, they have reason to be concerned. These losses are partially offset with those who were recently employed (and decide to purchase a new phone/plan). We think the table above explains why there remains uncertainty about how the United States’ economy will grow in 2025 and 2026.
Things are tough all over? Not in South Carolina.
Since the last Brief, we have also received Bureau of Labor Statistics (BLS) state-level data for employment through July (it lags the headline data by about three weeks). Nearby is a table showing the top seven states with increases total employment from July 2024 to July 2025. To no one’s surprise, Texas leads the way with a 232K increase. As return-to-office becomes more prevalent in New York City, employment grows.
What’s intriguing is that Pennsylvania, California, and each of the Carolinas grew roughly the same quantity of employed people over the last year. California has 7.5x more total employed people than South Carolina, yet they grew at essentially the same absolute rate. To the extent employment increases correspond to overall economic activity (state GDP), it would appear that the Southeast and Texas are booming, while New York is recovering and California is languishing. This would be a good time to be at Charter Communications (New York City, Dallas, Austin, San Antonio, Tampa/ Orlando and the Carolinas), save the fact that they are also the cable provider in Los Angeles. Not bad for Comcast as well (Pittsburgh, Philadelphia, Houston, and the remainder of Florida). Housing starts (read: new homes passed) should be accelerating in the Carolinas, while vacancies may be on the rise in the Golden State.
The Google ruling: Is equality a sufficient remedy?
On Tuesday, Judge Mehta issued a 233-page opinion outlining remedies from the 2024 ruling that Google violated Section 2 of the Sherman (Antitrust) Act. The headlines conveyed relief that Google would not have to sell or divest of the Chrome browser (we signaled from Judge Mehta’s closing questions in May that “no divestiture” was a distinct possibility). However, per the Department of Justice (DOJ) release (link here) celebrating the outcome, Google did not get off scot-free:
“Under the remedies ordered today, Google will be barred from entering or maintaining exclusive contracts relating to the distribution of Google Search, Chrome, Google Assistant, and the Gemini app. Google cannot enter or maintain agreements that (1) condition the licensing of any Google application on the distribution, preloading, or placement of Google Search, Chrome, Google Assistant, or the Gemini app anywhere on a device; (2) condition the receipt of revenue share payments for the placement of one Google application on the placement of another Google application; or (3) condition the receipt of revenue share payments on maintaining Google Search, Chrome, Google Assistant, or the Gemini app on any device, browser, or search access point for more than one year; or (4) prohibit any partner from simultaneously distributing any other GSE, browser, or GenAI product.
In addition, Google will have to make certain search index and user-interaction data available to certain competitors. Google will also be required to offer certain competitors search and search text ads syndication services, which will open up the market by enabling rivals and potential rivals to deliver high-quality search results and ads and compete with Google as they develop their own capacity.”
We see the syndication remedy as the bigger impact of the two (our belief was that Apple was already headed down the path to providing alternate Artificial Intelligence (AI) / search choices and the loss of exclusivity was a foregone conlusion to Cupertino). While this remedy requires Google to provide search results, most of their competitors aleady knew how Google’s search engine was structured. The components weren’t the mystery, but rather the refinement of the algorithm by hundreds of billions of iterations from smartphone, tablets, and other sources was unavailable. The benefit of this remedy is that Google’s competitors gain equality on search results in a world where Artifical Intelligence is quickly becoming the default query source.
Interestingly, Amazon could be the big winner here if the Silk browser qualifies for the syndication results (see browser market share here – not sure if they will make the cut or not) . Not an earth-shattering win, but it could help Amazon develop a better Kindle interface for Fire tablet users.
Bottom line: The advancement of AI over the last three years meaningfully narrowed Judge Mehta’s remedies. While Google gained $264 billion in value (and Apple gained $113 billion in value) this week, the impact on Amazon and Microsoft was minimal. We believe that says it all.
Apple’s Moment
Apple is expected to reveal their updated iPhone 17 on Tuesday and introduce a thinner version called the iPhone Air. Mark Gurman of Bloomberg outlines the full state of expected announcements in this article. We agree with Mark that hardware improvements are going to dominate the show and think that could mean good things for the company.
Most important to our readers is the introduction of the iPhone 17 Air, which Gurman thinks will be replacing the Plus lineup on the iPhone 16. There are drawbacks to the thinner design, including a reduced battery life and a single-lens rear camera. But the processor is the same as will be used in the new iPhone 17. We do not think that there will be many defectors from the iPhone 17 Pro or iPhone 17 Pro Max to the iPhone 17 Air model but believe that those who are willing to trade off weight for battery life will likely move to the Air. We also think that the carrier’s “free” offer will stay on the iPhone 17 Pro (this assumption could change if the price difference between the Air and the Pro is large).
Per Gurman’s article:
“In line with past pro iPhone upgrades, the processor will move to the A19 Pro, battery life will be boosted significantly, video recording will get major enhancements and the telephoto lens will move from a 12-megapixel sensor to a 48- megapixel component. Other camera upgrades will include a new variable aperture system, simultaneous front-and-back video recording and the biggest-ever upgrade to the selfie camera.”
These improvements mean that Apple FaceTime users will be able to be seen more clearly if they are using the iPhone 17 Pro or Pro Max. This improvement alone may drive prospective Air users to the Pro lineup.
On top of the iPhone 17, iPhone 17 Air, and iPhone 17 Pro launch, there should be a new lineup of Apple Watches. Finally, the company will introduce a new lineup of Apple Air Buds capable of translating live conversations. It is not clear from Gurman’s article if Apple has developed their own translation engine or will be using another (Gemini) version.
Bottom line: Apple’s September event can move the fourth quarter needle for the Big 3 wireless carriers. So far, it doesn’t look like 2025 will have the same impact as the iPhone 12 in 2020 (the first 5G iPhone), but there are a lot of improvements, and we should not underestimate the number of customers coming off iPhone 14 (3-year) payment plans at Verizon and AT&T. Given Apple’s inability to effectively launch a Maps app (Google still has a majority market share install and use rate on iPhones) and the fact that Siri has diminished in overall importance thanks to AI apps already available to iPhone users, the expectation that Apple will be leading the AI revolution is presumptuous. If the announcements in the article come to fruition, we would not be surprised to see a 2 or 3-percent increase in iPhone sales volumes for the 2025 Holiday selling season.
(Note: We will begin our sales tracker the weekend after the first full week of iPhone in-store availability. This will likely coincide with the next full Brief).
T-Mobile’s US Cellular Synergy Revisions: Rinse and Repeat
In advance of CFO Peter Osvaldik and COO Srini Gopalan’s appearances at industry conferences last Thursday, the company released revised synergy expectations for the US Cellular acquisition (here). The highlights are as follows:
- The company will integrate US Cellular into T-Mobile at least a year faster than previously announced (no surprise)
- Annual run-rate cost synergies will be 20% larger than previously announced (a small positive surprise)
- Cost to achieve will be $2.6 billion (slightly more than expected)
- Postpaid ARPU will be $1.50 lower starting in Q3 thanks to lower levels at US Cellular and Metronet
- The company is moving to a new billing system costing $350 million in impairment charges
Outside of the billing upgrade, the remainder of this announcement is a positive story. Since their Metro PCS acquisition in 2014, T-Mobile has had a disciplined approach to M&A integration. There were many lessons learned with Sprint, and it’s not surprising to see that the company has accelerated their US Cellular integration efforts (and will spend at the high end of expectations to achieve the $1.2 billion annual synergy level faster). Metronet is all upside for postpaid wireless, and there may be some Metronet/ US Cellular overlap as well.
The billing system upgrade could be a major distraction and will require a lot of management attention. While T-Mobile’s plans are generally simpler than their peers (thanks to the introduction of simpler unlimited plans), every billing system upgrade is intense and complex. The non-cash write-off comes with the decision, but the actual impact to the customer of a new billing system warrants continued attention.
Bottom line: AT&T’s integration of Echostar’s mid-band spectrum will be the easiest integration, but we think that T-Mobile’s integration of US Cellular won’t be far behind. The thought of a forklift upgrade of T-Mobile’s current billing system gives us pause as it could drive up churn levels.
In the next Brief, we will begin our third quarter preview with a synopsis of several conference appearances from wireless and cable companies. Meanwhile, if you have friends who are interested in being notified each time we publish a Brief, please have them sign up at www.sundaybrief.com.
Finally – Go Royals, Chiefs and Sporting KC!
Important disclosure: The opinions expressed in The Sunday Brief are those of Jim Patterson and Patterson Advisory Group, LLC, and do not reflect those of CellSite Solutions, LLC, or Fort Point Capital.
