NSA blowing it for AT&T’s European aspirations

AT&T has been making noises about wanting to expand in a big way in Europe. Both The Wall Street Journal and Bloomberg News have been covering speculation that the takeover target would be Vodafone, based in London, but with a long reach across Europe, the Middle East, and beyond.

AT&T is looking to European markets because like any large company wants to grow, but “the growth opportunities in AT&T’s core domestic market in the United States are starting to become more limited,” says Gartner mobile analyst Bill Menezes.

This has prompted AT&T to look overseas for potential customers and Vodafone is an ideal company to purchase. But these are two giant companies. “Any tie up of that size is going to have a lot of regulatory hurdles to overcome to start with,” Menezes says.

Add to that list of hurdles the issue of privacy. When Edward Snowden released a report claiming the U.S. collected email and phone data from abroad, it didn’t sit well with European leaders.

“Now the idea that NSA could conceivably extend its reach through AT&T’s ownership, even deeper into European customer data,” Menezes says, “is something they view with pretty great concern.”

And that concern could put pressure on regulators and jeopardize any potential purchase of a European telecom provider by AT&T.