Wednesday, August 31, 2011

AT&T - T-Mobile Deal Opposed By DOJ!

AT&T - T-Mobile Deal Blocked By DOJ http://snapvoip.blogspot.com/

We were surprised this morning by the reports on Bloomberg and the WSJ saying that the United States Department Of Justice (DOJ) is lopposing the AT&T’s proposed $39 billion acquisition of T-Mobile on antitrust grounds.

The news is scant but Bloomberg grabbed the following from the complaint filed in federal court stating;

“AT&T’s elimination of T-Mobile as an independent, low- priced rival would remove a significant competitive force from the market.”
Later FCC chairman Julius Genachowski stated;

“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.”
We were not happy about the acquisition but took it for granted that the deal will go through. In fact one of our colleagues was planing to defect from AT&T and go to T-Mobile but changed his mind after the news and is enjoying unlimited data voice service from Sprint. The AT&TT-Mobile deal was backed by Facebook and Microsoft, and 10 venture capital firms, Others include Yahoo, Oracle and the Research in Motion and was also opposed by many.

Of course AT&T is unhappy about the news and plans to take action. Should the deal fall through, AT&T will have to pay Deutsche Telekom, the parent company of T-Mobile upwards of 6 Billion.

AT&T's Wayne Watts,senior executive VP and general counsel released the following statement regarding the news stating that they plan to fight the decision in court;

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.
Yes we want T-Mobile, as a separate entity.

Via TechCrunch

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