Department of Justice Files to Block AT&T-T-Mobile Merger
by Andrew Cunningham on August 31, 2011 11:30 AM ESTThe United States Justice Department has filed to block AT&T's proposed buyout of T-Mobile today, saying that the merger would "remove a significant competitive force from the market."
The potential deal, a $39 billion dollar affair which would have made AT&T the US's largest wireless carrier, was first announced in March, and would have greatly expanded AT&T's network and subscriber base. Opponents of the deal concluded, as did the DoJ, that the deal would leave too few competitors in the market, and would leave Sprint (a distant third to AT&T and Verizon) much less able to compete with the larger companies.
Source: Bloomberg
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KPOM - Wednesday, August 31, 2011 - link
This sounds politically motivated to me. A dying T-Mobile USA doesn't provide much competition as it is, and it is unrealistic to think that Sprint could integrate a GSM/WCMDA network given that it is still trying to fully integrate Nextel and roll out LTE (which T-Mobile hasn't even started doing yet).I think that the administration is trying to improve its popularity, but at the end will settle for a few concessions from AT&T (e.g. giving up spectrum to Sprint, or refraining from exclusive contracts for popular phones).
Wierdo - Wednesday, August 31, 2011 - link
there's nothing this merger offers that's good for the consumer, it's only good for AT&T. Why break AT&T up (who used to charge dollars per minute not cents at some point when it was a monopoly) then let them monopolize the market allover again? The market sucks already as it is with the few big companies controlling it left.Some places on the planet where a hundred options exist to choose from (vs a few in most places here) provide cell service for a fraction of the cost to its consumers because they have a true free market that's well-regulated for the benefit of consumers rather than corporations, as it should be. Why would we wanna go in the other direction and make things even worse?
fhaddad78 - Wednesday, August 31, 2011 - link
You are both very correct. But my money is on the deal going through in the end because people will be paid off and deals will be made behind the scenes. It's all crap, the government no longer represents the people in this country in anymore. They represent special interests. I believe it was recently revealed that Obama accepted donations to push the Sun Oracle deal: http://www.dailytech.com/article.aspx?newsid=22581...Anyway, I did my part. I sold my cell phone contract online and walked away from my cell phone. These companies are stealing and what they are charging for their services (no matter how you try to justify it) is simply a reflection of corporate greed. Nothing more.
If you want to see more competition in the market, more reasonable prices for cell phone services, cross-network compatible phones, etc, simply stop using your cell phone. Walk away. Watch how fast prices drop. Watch how much more competitive the market gets. I know it's hard when we are so used to these things. God knows, everyone must be connected to their Facebook account 24/7. (:
Seriously though, the consumer has more power than you think. It's very easy to bully government and greedy corporations just as they do to the consumer. Only we are really at the advantage. Just stop using their products and services.
fhaddad78 - Wednesday, August 31, 2011 - link
Bad link in previous post: http://www.dailytech.com/article.aspx?newsid=22581anandreader106 - Wednesday, August 31, 2011 - link
Dailytech should never be used as a reference for anything.fhaddad78 - Wednesday, August 31, 2011 - link
Funny, I thought someone might say that as I was hitting Ctrl+V (=KPOM - Wednesday, August 31, 2011 - link
It's a contradiction to say a "true free market that's well-regulated." The issue we have in this country is that we had a government-sponsored monopoly (AT&T), broke it up in a bit of forced government "competition," and gradually let it come back together because the "competitors" created were too small to survive individually. Europe actually had an easier time creating competition because they could simply let the former monopolies in their neighbors compete in their home markets (e.g. France Telecom launching Orange in the UK).Taft12 - Wednesday, August 31, 2011 - link
Unregulated free markets exist only in Libertarian fantasies and not in the real world. Lack of regulation is what led to the original AT&T monopoly, and, well, every other harmful monopoly that has ever existed.ChuckDriver - Wednesday, August 31, 2011 - link
The original AT&T monopoly was regulated and permitted by the federal government after negotiations with the attorney general. http://en.wikipedia.org/wiki/Kingsbury_CommitmentHector2 - Wednesday, August 31, 2011 - link
Seems a no brainer to me. Consumers have nothing to gain from this merger as it would reduce competition.