Justice Department Seeks To Block AT&T, T-Mobile Merger

By JOELLE TESSLER and PETE YOST, Associated Press

WASHINGTON -- The Justice Department filed suit Wednesday to block AT&T's $39 billion deal to buy T-Mobile USA on grounds that it would raise prices for consumers.

The government contends that the acquisition of the No. 4 wireless carrier in the country by No. 2 AT&T would reduce competition and thus lead to price increases.

At a news conference, Deputy Attorney General James Cole said the combination would result in "tens of millions of consumers all across the United States facing higher prices, fewer choices and lower quality products for mobile wireless services."

The lawsuit seeks to ensure that everyone can continue to receive the benefits of competition, said Cole.

Four nationwide providers account for more than 90 percent of mobile wireless connections - AT&T, T-Mobile, Sprint and Verizon.

T-Mobile has been an important source of competition, including through innovation and quality enhancements such as the roll-out of the first nationwide high-speed data network, Sharis Pozen, acting chief of Justice's antitrust division, said at the news conference.

Mobile wireless telecom services play a critical role, with more than 300 million smart phones, data cards, tablets and other mobile wireless devices.

Comments

[lgc112808jal]

07:18 PM on 10/18/2011

Lets get together and create a new wireless plan one so affordable that everyone will drop their service hot and come to us. Lets keep the means of manufacturing and customer service in a America and give millions of American's their jobs back. And all the people said AMEN. So lets do it. Steal my idea tech genius' and call it America's Phone. Lets change the status quo.

[Heather Howerton]

11:14 AM on 09/06/2011

C'mon people, if ATT doesn't by Tmobile Deutsch Telecom will just find some other way to sell them and instead of it being sold as one entity it will be broken up and sold to those providers anyway. Tmobile is going to be sold one way or another. This is definitely the best option.

[Makali Utlayolisdi]

08:46 AM on 09/03/2011

p.s. Block the merger and I'll be renewing my plan with T-Mobile. Allow the merger and I'll drop my current service faster than AT&T can say boo.

[Makali Utlayolisdi]

08:44 AM on 09/03/2011

Like many T-Mobile users I know, I do not want the merger at all. I, and many others, specifically rejected AT&T due to their business ethic, or lack thereof. If they are allowed to buy T-Mobile we can be assured of diminished customer service and games played with our rates and plans.

Go away, AT&T. We don't want you. Should you be allowed to buy T-Mobile expect a considerable exit of current userts who rejected you long ago.

[paddio]

03:21 PM on 09/02/2011

AT&T needs to up their political contributions.....then.....they will get their merger

[brandon20678]

09:38 AM on 09/02/2011

Finally the FEDS Stands up for the American People. No more corporate buyouts.

[Seattlelite]

05:42 PM on 09/01/2011

There was a reason why the telephone monopoly was broken up in the first place, so what's changed?

[Craig Bovia]

04:15 PM on 09/01/2011

There was a very good reason ATT was broken up 40 years ago. The last thing telephone users need in the US is a ATT as a monopoly all over again. There are very few consumer companies still in business that treat their customers more unfairly than ATT. Blocking the merger will infuse
T-Mobile with the cash it needs to compete profitably in the US. It is a beautiful thing that the cash will come from ATT. I wonder which party ATT will be throwing tons of cash at in 2012?
Thanks to the Court of the Supremely Wealthy, ATT should be able to purchase the repubs

[tnjr]

11:00 PM on 09/01/2011

Did anyone tell Obama that the CWA wanted this merger to create jobs. Obama wonders where the jobs are, yet his DOJ blocks this merger and tells Gibson guitars to finish their guitars overseas and not in the US. If they merge, you would still have Verizon Wireless and Sprint

[Brent Rossen]

01:31 AM on 09/02/2011

I was under the impression that mergers usually result in the elimination of jobs due to redundancy/reorganization.

[SparePocket]

08:53 AM on 09/02/2011

I've heard from some T-Mobile employees that pink slips have already started going out to call centers.

[SunsetBeach]

02:30 PM on 09/01/2011

As a very satisfied 4-year+ customer of T-Mobile I'm relieved that I won't have to join AT&T. Perhaps T-Mobile will eventually disappear, but I at least have some respite for now. T-Mobile has great service and prices. I have great signal access and unlimited data for e-mail and web-surfing, both in the U.S. and in Europe, no roaming charges! And I can "tether" my T-Mobile Dash into my laptop when I can't otherwise get an internet signal, something you apparently can't do with other companies.

When talk of the merger surfaced, it seemed pretty clear that AT&T would not "grandfather" us in on our old T-Mobile plans, but would start limiting data. And who knows what they'd charge us when we're travelling in Europe (which uses only the GSM system).

For those of us on the GSM system, AT&T is the only other game in town and they need SOME competition, which T-Mobile has provided. My thanks to the Justice Department for this one!

[original joanie]

04:50 AM on 09/02/2011

Funny. I had just the opposite experience. Poor reception and when I lost my phone at seventeen days it took me three hours to find someone who would answer the phone and help me after 9 pm. Because reception was poor, I decided against continuing service and ended paying almost $400 including a penalty for ending the service. I ended the service mostly because I was so peeved at their lack of accessibility when I tried to inform them that my phone was lost.

[streetbiker]

02:21 PM on 09/01/2011

Deutsche-Telekom should suck it up, find the capital, and go for an all-out attempt to remedy their network and coverage issues, and make the attempt to become a player. T-mobile merger talk has always been really about T-mobile not having the gumption to lay out the required capital investments and play to win. T-mobile management need to return to the idea of being in it for the, at least, the "near-term" long-haul. Even a "limited" build-out and remedy of infrastructure problems at t-mobile (say a 3-year plan) would add tremendous shareholder value in any ultimate "sell-out" because as it is now, t-mobile negotiates from a position of weakness, because their customer service arm is their only real high card (and of course their low prices let us not forget). A 3-year build-out and infrastructure remedy would put them in a position to bargain very tough in "round 2" and perhaps in a more robust climate, where valuation of the company would be greatly increased, but to do that they need "capital" and a long-term "believer" (sovereign wealth?). But to fold a first-class organization like T-mobile into mediocre (at best) companies like ATT or Sprint would be the loss of a first class company which is lacking only nerve and determination to win in the hearts of it's senior management and largest stockholders.

[Craig Bovia]

04:17 PM on 09/01/2011

Fanned for extreme intelligence

[Mister Grumpy]

02:18 PM on 09/01/2011

If AT&T wanted to bring back those calling center jobs to the US, they would have done it already.........

I have a AT&T (formally Cingular) call center in my town........ and the only reason why they are still there is because Cingular built the facility with tax credits from the state and city, which they will have to pay back if the facility is closed.......... but still it has just a fraction of the employees working there today it had ten years ago.......... as soon as the tax credits expire I expect AT&T to off shore the rest of the work to India so the building will become another abandoned eyesore for all to view...........

Thank you corporate America...........

[vonPinto]

01:48 PM on 09/01/2011

Tell me, HOW WOULD CREATING JUST ONE MORE R O G U E HURT AMERICA?

We have them all around us, in our cities, small towns and you name it. I guess that when AT&T "settles" the right people, they will get the deal.

Meanwhile, my T-Mobile phone (and reach) is waiting for an UPGRADE.

[thereisonlyoneparty]

12:06 PM on 09/01/2011

This is pretty much the end for T-Mobile.

The only other option is merging with Sprint.  That new company would then have to manage several different networks (Nextel legacy iDen ((offline in 2017)), Sprint's CDMA, T-Mobile's GSM, and WiMax network with Clearwire.)

Sprint barely survived the Nextel merger.  I doubt it would survive the next one.

This could be the decision that ended two mobile phone companies.

[Mister Grumpy]

02:12 PM on 09/01/2011

Actually people I know that left T-Mobile wasn't because of poor service, but because they didn't want to be a part of AT&T..........

[Seattlelite]

11:31 AM on 09/01/2011

This merger will create more jobs......well history would prove otherwise. When these big corporations merge there are always BIG layoffs. And never is less competition a benefit to consumers.

[Mister Grumpy]

02:20 PM on 09/01/2011

And those being merged is always on the losing end............

[hippy26ish]

11:08 AM on 09/01/2011

if at&t is no. 2, then who is the no.1 competition in the field?

[thereisonlyoneparty]

12:06 PM on 09/01/2011

Verizon Wireless.

[hippy26ish]

12:42 PM on 09/01/2011

thanks :)