The mobile industry is buzzing today over the DOJ’s decision to block the proposed AT&T acquisition of T-Mobile. There’s been split reaction since the merger was proposed, and opinions are flying around hot and heavy since the latest news broke early this morning.
AT&T was quick to issue a statement regarding the decision, saying they were “surprised and disappointed by today’s action,” especially since they’d met with the DOJ repeatedly and had no indication that such an action was being contemplated. “We plan to ask for an expedited hearing so the enormous benefits of this merger can be fully reviewed,” explained Wayne Watts, AT&T senior executive VP and general counsel in a prepared statement. “The DOJ has the burden of proving alleged anti-competitive affects and we intend to vigorously contest this matter in court.”
AT&T outlines three reason it feels the merger is anything but anti-competitive:
- It helps solve our nation’s spectrum exhaust situation and improve wireless service for millions.
- Allows AT&T to expand 4G mobile broadband to another 55 million Americans, or 97% of the population.
- Results in billions of dollars in additional investment and tens of thousands of jobs, at a time when our nation needs them most.
While AT&T continues to preach the benefits of the merger, several others have vastly different opinions. Washington D.C.-based public interest group Public Knowledge issued a statement attributed to it’s legal director Harold Feld, saying “fighting this job-killing merger is the best Labor Day present anyone can give the American people. AT&T’s effort to recreate ‘Ma Cell’ by holding rural broadband hostage and threatening American jobs deserves nothing but scorn. The FCC should move as quickly as possible to follow the lead of the Department of Justice and reject the merger.”
We spoke to White & Case Attorney Maury Mechanick, a former senior executive at COMSAT Corporation and Lockheed Martin Global Telecommunications, who tells us “the Justice Department is clearly convinced that harm to competition from the proposed merger would outweigh any purported public interest benefits, including those alleged to increase broadband penetration in the U.S. If the merger had gone forward, the market power and advanced service feature capabilities of three major operators would have made it increasingly difficult for smaller cellular operators to attract sufficient customers to survive in the marketplace.”
We’d love to hear your thoughts on the DOJ’s decision and the proposed merger in general, please feel free to speak your mind in the comments below.