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AT&T Looks to Europe for Opportunities

NEW YORK ( TheStreet) -- AT&T (T - Get Report) is looking across the Atlantic Ocean at the vast European market despite the challenges all phone companies face in the region.

Despite the European Union, doing business in this region is still complicated and much more regulated for phone companies, with markets that have fragmented pricing and governments where it is a real challenge to create a regional network.

Still, the idea of moving over to Europe makes sense since AT&T has the experience of creating a fourth-generation (4G) U.S. network. It makes sense to apply it to Europe. Faster service would naturally lead to mobile customers increasing data usage. I believe the thinking is sound.

To expand into Europe, one strategy under consideration is buying a European phone company. Vodafone (VOD), in the news for quite some time since selling its stake in Verizon Wireless, is a strong candidate.

AT&T has battled "big brother" Verizon Communications (VZ) to keep its dominance in the sales of iPhones, to no avail. Verizon is picking up ground and increasing its iPhone sales, creating a nice dominance in the mobile advertising market. In the spring of 2013 the iPhone boasted 64% of the mobile advertising market share.

In terms of subscribers, Verizon is the largest mobile phone carrier in the United States with a slight edge over AT&T. With the U.S. market becoming more and more saturated, building a 4G network in Europe almost looks like virgin revenue territory.

Still, there are risks. Within the last decade there have been global-minded Internet companies that have attempted to expand their networks internationally by counting on rising Internet usage to pay for it. Do you remember Worldcom? It had a global network that included the United States, Europe and parts of Latin America but ended up filing for bankruptcy.

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