In a stunning move that’s sure to be just another chapter in the AT&T/T-Mobile merger, the Department of Justice has decided to file an antitrust complaint with the FCC. Citing “higher prices, fewer choices, and lower quality products” for consumers, the DOJ hopes to block the merger pending likely appeals from both AT&T and Deutsche Telekom. If the block does go through, At&T will also have to pay about $3 billion in both capital and roaming access, which means T-Mobile might end up looking a lot more appealing to consumers as a separate entity in the short term.
As always, each of the parties in this lawsuit have released public statements reaffirming their positions and all promising to make this just a stepping stone to their eventual ends -
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.
On August 31, 2011, the United States Department of Justice (DOJ) informed Deutsche Telekom that it will file a complaint in the U.S. District Court for the District of Columbia seeking a permanent injunction blocking the proposed stock purchase agreement between AT&T and Deutsche Telekom under which AT&T will acquire T-Mobile USA from Deutsche Telekom.
Deutsche Telekom is very disappointed by the DOJ’s action, and will join AT&T in defending the contemplated merger against the complaint in court. DOJ failed to acknowledge the robust competition in the U.S. wireless telecommunications industry and the tremendous efficiencies associated with the proposed transaction, which would lead to significant customer, shareholder, and public benefits. We appreciate the DOJ’s willingness to discuss possible remedies to address the competitive concerns.
FCC’s Julias Genachowski
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.
For more information on this case, check out Nilay Patel’s analysis at the via link and the full Department of Justice filing at the source.
Source: DOJ filing | Via: This is my next