PhoneDog Media Exclusive
Download iM5, now available in the App Store and Google Play. iM5 is a PhoneDog Media backed Social Platform to inspire real-life action through the crowdsourcing of ideas. See the video

AT&T-Mobile

Hold on to your hats, folks, because things in AT&T's proposed acquisition of T-Mobile are about to get crazy. A report from Bloomberg has just revealed that the U.S. Department of Justice has filed an anti-trust complaint with a Washington court in an attempt to block the AT&T/T-Mobile deal. “AT&T’s elimination of T-Mobile as an independent, low-priced rival would remove a significant competitive force from the market,” the DoJ said in its filing.

Although this filing doesn't guarantee that AT&T's merger with T-Mobile will be shot down, it will make getting the deal approved more difficult for AT&T going forward. If the acquisition is denied, AT&T will be forced to pay T-Mobile $3 billion and hand over some AWS spectrum that isn't critical to AT&T's LTE rollout. Despite the fact that AT&T is prepared to divest some of its markets and make other concessions to get its purchase of T-Mobile approved, the deal has been met with quite a bit of opposition — both from other carriers and government officials — since it was announced.

UPDATE: FCC Chairman Julius Genachowski has issued a statement on the Department of Justice's attempt to block the AT&T/T-Mobile deal:

"By filing suit today, the Department of Justice has concluded that AT&T's acquisition of T-Mobile would substantially lessen competition in violation of the antitrust laws. Competition is an essential component of the FCC's statutory public interest analysis, and although our process is not complete, the record before this agency also raises serious concerns about the impact of the proposed transaction on competition. Vibrant competition in wireless services is vital to innovation, investment, economic growth and job creation, and to drive our global leadership in mobile. Competition fosters consumer benefits, including more choices, better service and lower prices."

UPDATE 2: And now we've got an official statement from Wayne Watts, AT&T Senior Executive Vice President and General Counsel, on the DoJ's suit:

"We are surprised and disappointed by today's action, particularly since we have met repeatedly with the Department of Justice and there was no indication from the DOJ that this action was being contemplated.

We plan to ask for an expedited hearing so the enormous benefits of this merger can be fully reviewed. The DOJ has the burden of proving alleged anti-competitive affects and we intend to vigorously contest this matter in court.

At the end of the day, we believe facts will guide any final decision and the facts are clear. This merger will:

  • Help solve our nation's spectrum exhaust situation and improve wireless service for millions.
  • Allow AT&T to expand 4G mobile broadband to another 55 million Americans, or 97% of the population;
  • Result in billions of additional investment and tens of thousands of jobs, at a time when our nation needs them most.

We remain confident that this merger is in the best interest of consumers and our country, and the facts will prevail in court."

UPDATE 3: The statements keep rolling in! Now we've got Sprint's official statement on the matter. You can find it below:

“The DOJ today delivered a decisive victory for consumers, competition and our country. By filing suit to block AT&T’s proposed takeover of T-Mobile, the DOJ has put consumers’ interests first. Sprint applauds the DOJ for conducting a careful and thorough review and for reaching a just decision – one which will ensure that consumers continue to reap the benefits of a competitive U.S. wireless industry. Contrary to AT&T’s assertions, today’s action will preserve American jobs, strengthen the American economy, and encourage innovation.”

 

Justice Department Files Antitrust Lawsuit to Block AT&T’s Acquisition of T-Mobile
Transaction Would Reduce Competition in Mobile Wireless Telecommunications Services, Resulting in Higher Prices, Poorer Quality Services, Fewer Choices and Fewer Innovative Products for Millions of American Consumers

WASHINGTON – The Department of Justice today filed a civil antitrust lawsuit to block AT&T Inc.’s proposed acquisition of T-Mobile USA Inc.   The department said that the proposed $39 billion transaction would substantially lessen competition for mobile wireless telecommunications services across the United States, resulting in higher prices, poorer quality services, fewer choices and fewer innovative products for the millions of American consumers who rely on mobile wireless services in their everyday lives.
 
The department’s lawsuit, filed in U.S. District Court for the District of Columbia, seeks to prevent AT&T from acquiring T-Mobile from Deutsche Telekom AG. 

“The combination of AT&T and T-Mobile 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,” said Deputy Attorney General James M. Cole.   “Consumers across the country, including those in rural areas and those with lower incomes, benefit from competition among the nation’s wireless carriers, particularly the four remaining national carriers.   This lawsuit seeks to ensure that everyone can continue to receive the benefits of that competition.”

“T-Mobile has been an important source of competition among the national carriers, including through innovation and quality enhancements such as the roll-out of the first nationwide high-speed data network,” said Sharis A. Pozen, Acting Assistant Attorney General in charge of the Department of Justice’s Antitrust Division.   “Unless this merger is blocked, competition and innovation will be reduced, and consumers will suffer.” 

Mobile wireless telecommunications services play a critical role in the way Americans live and work, with more than 300 million feature phones, smart phones, data cards, tablets and other mobile wireless devices in service today.   Four nationwide providers of these services – AT&T, T-Mobile, Sprint and Verizon – account for more than 90 percent of mobile wireless connections.   The proposed acquisition would combine two of those four, eliminating from the market T-Mobile, a firm that historically has been a value provider, offering particularly aggressive pricing. 

According to the complaint, AT&T and T-Mobile compete head to head nationwide, including in 97 of the nation’s largest 100 cellular marketing areas.   They also compete nationwide to attract business and government customers.  AT&T’s acquisition of T-Mobile would eliminate a company that has been a disruptive force through low pricing and innovation by competing aggressively in the mobile wireless telecommunications services marketplace. 

The complaint cites a T-Mobile document in which T-Mobile explains that it has been responsible for a number of significant “firsts” in the U.S. mobile wireless industry, including the first handset using the Android operating system, Blackberry wireless email, the Sidekick, national Wi-Fi “hotspot” access, and a variety of unlimited service plans.   T-Mobile was also the first company to roll out a nationwide high-speed data network based on advanced HSPA+ (High-Speed Packet Access) technology.  The complaint states that by January 2011, an AT&T employee was observing that “[T-Mobile] was first to have HSPA+ devices in their portfolio…we added them in reaction to potential loss of speed claims.”

The complaint details other ways that AT&T felt competitive pressure from T-Mobile.   The complaint quotes T-Mobile documents describing the company’s important role in the market:

  • T-Mobile sees itself as “the No. 1 value challenger of the established big guys in the market and as well positioned in a consolidated 4-player national market”; and
  • T-Mobile’s strategy is to “attack incumbents and find innovative ways to overcome scale disadvantages.   [T-Mobile] will be faster, more agile, and scrappy, with diligence on decisions and costs both big and small.   Our approach to market will not be conventional, and we will push to the boundaries where possible. . . . [T-Mobile] will champion the customer and break down industry barriers with innovations. . . .”

The complaint also states that regional providers face significant competitive limitations, largely stemming from their lack of national networks, and are therefore limited in their ability to compete with the four national carriers.   And, the department said that any potential entry from a new mobile wireless telecommunications services provider would be unable to offset the transaction’s anticompetitive effects because it would be difficult, time-consuming and expensive, requiring spectrum licenses and the construction of a network.

The department said that it gave serious consideration to the efficiencies that the merging parties claim would result from the transaction.   The department concluded AT&T had not demonstrated that the proposed transaction promised any efficiencies that would be sufficient to outweigh the transaction’s substantial adverse impact on competition and consumers.   Moreover, the department said that AT&T could obtain substantially the same network enhancements that it claims will come from the transaction if it simply invested in its own network without eliminating a close competitor.

AT&T is a Delaware corporation headquartered in Dallas.   AT&T is one of the world’s largest providers of communications services, and is the second largest mobile wireless telecommunications services provider in the United States as measured by subscribers.   It serves approximately 98.6 million connections to wireless devices.   In 2010, AT&T earned mobile wireless telecommunications services revenues of $53.5 billion, and its total revenues were in excess of $124 billion.
 
T-Mobile, is a Delaware corporation headquartered in Bellevue, Wash.   T-Mobile is the fourth-largest mobile wireless telecommunications services provider in the United States as measured by subscribers, and serves approximately 33.6 million wireless connections to wireless devices.   In 2010, T-Mobile earned mobile wireless telecommunications services revenues of $18.7 billion.   T-Mobile is a wholly-owned subsidiary of Deutsche Telekom AG.
 
Deutsche Telekom AG is a German corporation headquartered in Bonn, Germany.   It is the largest telecommunications operator in Europe with wireline and wireless interests in numerous countries and total annual revenues in 2010 of €62.4 billion.

Via Bloomberg


Don't forget to VOTE! Each week, PhoneDog Fans vote for their #1 smartphone in the Official Smartphone Rankings. Vote now and contribute to the industry's most relevant weekly ranking charts


Related posts



Comments & discussions  

99 Reactions to this post

"Are you happy to hear that the Department of Justice is trying to block the AT&T/T-Mobile deal?"


Please limit your reaction to 140 characters or use comments for a longer reply :)
Add
Thanks for your participation! :)

Jason Browne
Jason Browne Fuck att
Santiago Alexander Cruz
Santiago Alexander Cruz Hells Yeah! Leave T-Mobile alone!
Max Burns
Max Burns YESSSSSSSS!!!!
Ellis David Syke
Ellis David Syke no! i want AT&T! T mobile has junky phones, and service. if tmobile got the Iphone then i would be happy
Devontae Johnson
Devontae Johnson *3
Devontae Johnson
Devontae Johnson Some Of You Need To Read More ! If The Deal Dont Go Through Tmo Gets 2 Billion Dollars Witch Mean They Will Not Go Out Of Business !
Facebook user
Facebook user It reminds me of an episode of the daily show back in the early to mid 2000's where they discussed the history and evolution of phone service in the US.... I'd be happier if there was some sort of oversight to guard against price gauging from the major carriers.
Myron Black
Myron Black oh hell yes
Bill Moran
Bill Moran Very happy to see the block by the Justice Dept, now if the FCC plays ball and the court sides with the Justice Dept
Melissa Wynemia Kritzell
Melissa Wynemia Kritzell yes!!!
Fritz Leipold
Fritz Leipold I'm ecstatic - I've always had decent service with T-Mobile, and have heard horror stories from friends who USED to have AT&T. If I'd wanted to have AT&T as a mobile provider, I'd have damn well signed up with them in the first place - or at any point in the last decade. As for AT&T's offer to bring back 5000 jobs if the merger goes through, my understanding is that these are call center jobs - hardly high-paying tech sector jobs - and they would likely be offset by layoffs throughout the rest of the merged companies. Why doesn't AT&T just bring some jobs back to the US *without* screwing up my cell service?
Tad Duet
Tad Duet Yes!
Scott Brant
Scott Brant Good news. Tmos signal should get better in outlying areas if the deal is blocked with the 3 bill and additional spectrum they get should the deal get blocked. Lets hope thats how it plays out.
Eduardo Colon
Eduardo Colon Well, I'm on edge. My understanding is with the merge I will get better signal in certain areas and honestly, who doesn't want a good signal everywhere they go? On the other hand, I just switched to Tmobiles family plan and I have 3 lines with unlimited text,call,mms, with 2 of them unlimited data. My bill is $145 a month. With ATT I can't get that so I'm slightly weary of that. In these days a dollar does not reach far at all and who wants to give away money they don't have? I dunno fam....
Ediben Yoonan
Ediben Yoonan hell nooo
Elizabeth Benson
Elizabeth Benson I am ecstatic but will only celebrate when it's definitely over
Sharang Karve
Sharang Karve i am DEFINITELY happy
John Domalis
John Domalis HELL YEAH!!!!!!
Micah Madru
Micah Madru I'm so happy, now hopefully this NEVER passes. The only buyout of tmobile I would be happy with is if it's from another company that isn't in the wireless game.
Lewis Hachmeister
Lewis Hachmeister It will be so great when t-mobile makes 3 billion off this. Way to think that through. Att....not so much.
Vincent Whalen
Vincent Whalen Yaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaayyyyyyyyyyyyyyyyyyyyyyyyyyyyyyyyyyyyyyyyyyyyyyyyyyyyyyyyyyyyyyyyyyyyyyyyyyyyy thank you doj I thank you oh so much!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!
Joseph Kutchukov
Joseph Kutchukov Yup, 4 = more competition...and lower prices
Jason Russ
Jason Russ Yes sir!! no one would be to compete
Tim Fuhrmann
Tim Fuhrmann Couldn't care less. T-Mobile sucks ass anyways since the merger was announced.
Justin Wilson
Justin Wilson Yes I don't want to go t AT&T
Paul Vanderbear
Paul Vanderbear HELL YES.
Nick Kalman
Nick Kalman Not happy at all. It means that still we would junk T-Mobile that doesn't work anywhere.
Mike Dougall
Mike Dougall If the deals blocked T Mobile gets 3 billion dollers and they Get to use 10 or 15 percent of Att towers
John Carl
John Carl So what is AT&T gonna do when they merge? Jack up T-mobile customers bill?
Ross E.
Ross E. So very very happy!!!!!!!
José J. Landrau
José J. Landrau YESSSSSSSSS!!!!!!!!!!!!!!
Jerry Parker
Jerry Parker Hell yes!
John Stelmack
John Stelmack not really because I want to have better service in my area and the merger will bring that.
Tim Buttry
Tim Buttry let it go through im on sprint lol
Cody Shawn Sullivan
Cody Shawn Sullivan so happy!
Equaknox Knox
Equaknox Knox Wow interesting,,,this with all news of HTC news and Poss Iphone5 on Sprint...I hope it doesnt happen,,Att&t trying to corner the market..with that said if that goes threw,,att&t will sale whack devices,,because they will have so many customer already locked in,,and if your where not grandfathered in---there data service will lame--capped,,as it already is,,,,y'all t-mobile ppl..better keep an eye or 2 on this,,,gonna shake up the cell phone game---i am on sprint--with the EVO class of handsets, ill be staying,,riding that waive for the duration....lol
Luis Montoya
Luis Montoya No
David Harness
David Harness No
Mike Jackson
Mike Jackson Yes yes yes!
J Alberto Garcia Flores
J Alberto Garcia Flores I think T-Mobile should stay T-Mobile because it's better than AT&T and Verizon and Sprint. But in the other hand no one should mind if AT&T buys T-Mobile, US doesn't own any of this companies, nor it's their business.
Michael Milkiewicz
Michael Milkiewicz Yes want to keep my tmo
Nahtanoj Divad Htrab
Nahtanoj Divad Htrab I think have two different carriers for the respective cellular technologies (GSM/CDMA) is important to keep competitiveness in the industry.
Ryan Mueller
Ryan Mueller It doesn't matter verizon is the leader of the cellphone world... and always will be.
Karl S. Moore
Karl S. Moore Please block it!
Brandon Johnson
Brandon Johnson How is this buyout any different than the ones between sprint/Nextel and Verizon/Altel. The only at&t can "monopolize" the phone industry in the US is to buy Verizon AND Sprint which we know they don't have the money to do.
Jarrel Watt
Jarrel Watt I am not a fan of higher prices, but I am in favor of better coverage. I have seen an att phone have a signal next to a tmobile phone that did not.
Robert Ashman
Robert Ashman WEWT!
Syuid Abraham
Syuid Abraham Yes, I want nothing to do with at&t
Ellery Arellano
Ellery Arellano I love hearing how people say that there is still competition despite if the merger happens. If the merger happens, AT&T and Verizon will be the only national carriers with over 80% of the market. Regional carrots don't count, because they don't have service is most areas. Historically, jobs go down with mergers/buy outs, so I don't understand AT&T's argument about new jobs after the merger. Consumer costs will go up, b/c AT&T needs some way to recoup the costs from the buy out. Drop calls will still be prevalent b/c of all the back hall in towers that AT&T has an their mismanagement of the current towers they own. Overall, this is not a good thing from an economic standpoint.
Paul Martin
Paul Martin At&t would only use this to jack up prices. If you look at coverage maps At&t already covers most if not all the high population areas Tmobile does. Service would not improve for the vast majority of customers and I'm sure neither would prices.
Vies Quince Sumlar
Vies Quince Sumlar Yes
Jamil Oquendo
Jamil Oquendo What happens when T-Mobile announces that since the deal didn't go through that they will be shutting down? Will the government issue another bailout at our expense? Or will T-Mobile just die, leaving all of use without service and useless phones and also T-Mobile employees losing their jobs? I was against this deal at first but then I sat back and thought of the possibilities if it indeed didn't go through.
Geoff Meza
Geoff Meza Yes!
Caleb Jeffers
Caleb Jeffers No the freaking government meeds to stay out of everybody's business. If these were the only cell providers then I would understand.
Travis Lindsay
Travis Lindsay Yes! !!
Kevin Joel
Kevin Joel Yes!
Tim Miyashiro
Tim Miyashiro Uh, T-Mobile is definately is going to be bought by someone. Deutsche Telekom wants out of the US Market.
French Twist
French Twist Yeah, a little. Amused, too.
Don Clabaugh
Don Clabaugh This is not good. AT&T said that if the deal was approved they would bring 5000 jobs back to the U.S. And all of T-Mobile &AT&T employees will keep their jobs. T-Mobile just laid off a bunch of their call center employees. The company that owns T-Mobile U.S.A. said they will not invest more money into T-Mobile U.S.A. So what will this do more lay off for T-Mobile.
Steve Moore
Steve Moore They should let it happen, their networks suck so bad maybe it would drive even more people away and they'd go out of business for good. One can only hope.
Matt Cain
Matt Cain @Morgan Hill and I are in complete agreement. Only thing I'd add is that maybe now AT&T can stop jacking up prices by taking away options that may work better for some and only leaving customers with expensive options that might not be what they need or can afford.
Tally K Blu
Tally K Blu I am interested to see how this plays out. I can see both sides.
Matthew Dyer
Matthew Dyer I'm happy that they might not merge but that still makes me want to switch to Verizon reguardless. But having them merge with T-Mobile was the 2nd reason why I'm going through with the switch next year in May.
Paul L. McCord Jr.
Paul L. McCord Jr. It is all show. It will happen.
Adrian Salazar
Adrian Salazar Hell yea...
Willie Entersillynamehere Julian
Willie Entersillynamehere Julian dropped calls would be an ATT issue not tmo customers problem if im correct. "We need to eliminate our competitor because we have dropped calls". So basically millions more should suffer to help them spread there shitty service! And yes I know all these companies have shitty service depending on where you may be in the country.
Steven William Oestreich
Steven William Oestreich Switched from AT&T to Sprint because ATT doesn't have unlimited data. And I believe they should keep 4 main companies. T mobile. ATT. Sprint. And Verizon. That'll keep things "normal"
Anton Yatsenko
Anton Yatsenko Hell yeah! Tmobile, btw, just screwed up on me. They lost my return phone..
Jeff Baker
Jeff Baker Hell yes... Death to the Death Star!
Allen Drewe
Allen Drewe If this falls through it hurts att and T-Mobile. You guys think its bad now T-Mobile would sell for far less if this merger dies.
Albert Tavarez
Albert Tavarez Hell yeah
Willie Entersillynamehere Julian
Willie Entersillynamehere Julian How does this merger really help current ATT customers? ATT can do all the things they claim they need tmo to do without merging. Only thing this merger does is eliminate a thorn in ATT side. But if it goes through then Verizon should be able to merge with sprint right? LOL im just talking out my ass I guess :-P
Luis Chavez
Luis Chavez Fuck you AT&T. Never again will I go to you
Brian Jones
Brian Jones For those that don't understand that once AT&T buy's out T-Mobile there will no more dropped calls from AT&T & better coverage from them I say let the deal go through it will Beat out Big Red at it's own game I mean really think about it were the people when VZ bought out the other competitors to become #1 & as far as Sprint I have been with Sprint/Nextel for years once they get there stuff together we can beat big red out & become #2 or even #1 once they start listening more to there customers that understand what goes on then they do I mean if I ran Sprint we would have been #2 along time ago I mean Hell we were the first with rolling out 4G yet they still have not turned it on here in Bakersfield Ca now we must wait for LTE to start up
Missy Wheeler
Missy Wheeler They need to be blocked. This isn't the first time at&t has tried to monopolize the phone industry. Government shot them down then too.
Larry Valdez
Larry Valdez I was part of the alltel merger and I have had no problem with at& t
Tim Springer
Tim Springer I'm waiting Sprint & maybe Tmobile to bring me the iPhone with a better pricing plan and good 4G service so I can switch from ATT. The iPhone is the only reason I switched from Tmo to ATT.
James Warren
James Warren Yes tthank God!!!!
Luis Robles Figueroa
Luis Robles Figueroa Hell yeah... as happy I can be. Great news!!!
Will Vuzzo
Will Vuzzo yessssssssssssssssssssssssssss
Jim Antrikin
Jim Antrikin As a consumer, I'm excited and hopeful that the merger will be blocked. For TMO employees, I would be concerned what would happen if the deal falls through.
Mark Orlowski
Mark Orlowski AT&T is a joke. My land line has increased by $20 while decreasing long distance minutes. stop this merger ATT has enough revenue
Matt Finzel
Matt Finzel No, I would like to see these companies merge, because it's better for the customers. If AT&T was smart with their business, they would know that after they get more coverage, they could reduce prices to get many more customers... So our bills might actually go down, coverage will be up. It's not a monopoly. It's just integration. There's still Verizon, Sprint, U.S. Cellular, Metro P.C.S., Virgin Mobile, etc. It's like saying, "Hey, Best Buy is a monopoly because they're the only good store dealing with technology." But that's not true, there's other options... shop online, go to Staples, but your shit at WalMart, etc. STOP THE FUSS.
Andres Barroeta
Andres Barroeta Yes
Aaron Couts
Aaron Couts Yep because most of t-mobiles customers are pissed off at&t customers lol.
Hunter Remington
Hunter Remington Yes!
Mark Navarro
Mark Navarro Hell yes! And haha to AT&T!
Morgan Hill
Morgan Hill I have mixed feelings about this. On one hand I don't like government interference in private enterprises. On the other hand I think that more companies makes for greater competition and is better for consumers.
Isaac Dadda Manford
Isaac Dadda Manford Noo waay. God im so happy rite now. OMG. NO SUCKY ATT
Tizoc Alarcon
Tizoc Alarcon I really dnt give a f***... sprint is number one!!! Lol dnt mean to troll but its not a big deal company's buy company's all the time and there are plenty other smaller company's to fill in the shoes if t-mobile get bought
Jon Recinos
Jon Recinos Very much so.
Tim Moore
Tim Moore Of course I am. Prices would have gone up and on top of that all of ATT's arguments weren't true. They don't need the spectrum or any of that.
Kenny Pop Davis
Kenny Pop Davis Hell yea
Dre Ill
Dre Ill Outstanding!!!!
Justin Sampaga-Erice
Justin Sampaga-Erice There was a reason why I switched to tmobe so I didn't have to pay a $100 bill every month
Nicholas Riddle
Nicholas Riddle Hell Ya
Cory IndaHouse Sonustun
Cory IndaHouse Sonustun OMG HELL YES!!!
Jason Singer
Jason Singer HAHAHA "true 4g" that's a laugh!! NOTHING we have in the US is "true 4g"
Tim Taricco
Tim Taricco I was with T-Mobile for 10 years until the iPhone 4 came out last June. Just based on 1 year of experience, I can tell you that T-Mobile is a far better company from a service, price and customer service point of view. If T-Mobile gets the iPhone 5, I will be back. I've spent too many hours on the phone with AT&T over billing mistakes ... just during this year ... and their 3G is damn slow compared to T-Mobile.




Most popular Videos
Most popular Videos
Most popular Videos

Most popular Reactions
Most popular Reactions
Most popular Reactions

This weeks "People's Choice Rankings" best smartphones
People's Choice Rankings


See all hot devices