Print 23 comment(s) - last by torpor.. on Mar 22 at 2:49 PM

“The merger would result in a wireless industry dominated overwhelmingly by two vertically-integrated companies"

The rumors persisted for months -- years, even. We reported on them as recently as March 8: "Report: Sprint in Talks to Acquire T-Mobile USA". Then, over the weekend, all previous speculations and ruminations were put to rest when it was announced that AT&T -- not Sprint -- was the most handsome suitor for the Magenta carrier 

Right about now, Sprint must be feeling like the nerdy boy who's been mustering the courage to ask out his crush -- a cheerleader, naturally, despite the pair's evident incompatibility -- only to learn that the object of his affection had been courted by the backup quarterback of the varsity football team over the weekend.

So what's Sprint going to do about it? Well, in this case, it means issuing a statement urging the Department of Justice (DOJ) and the FCC to consider the competition.

An AT&T/T-Mobile merger "would alter dramatically the structure of the communications industry,” Sprint said in a statement cited on Ina Fried's Mobilized blog. “AT&T and Verizon are already by far the largest wireless providers. A combined AT&T and T-Mobile would be almost three times the size of Sprint, the third largest wireless competitor.

“If approved, the merger would result in a wireless industry dominated overwhelmingly by two vertically-integrated companies that control almost 80% of the US wireless post-paid market, as well as the availability and price of key inputs such as backhaul and access needed by other wireless companies to compete,” Sprint said. “The DOJ and the FCC must decide if this transaction is in the best interest of consumers and the US economy overall, and determine if innovation and robust competition would be impacted adversely and by this dramatic change in the structure of the industry.”

AT&T told Mobilized that it wasn't worried about getting approval. “Today when you look across the top 20 markets in the country, 18 of those markets have five or more competitors, and when you look across the entire country, the majority of the country’s markets have five or more competitors,” AT&T President and mobile unit CEO Ralph De La Vega told Mobilized. “I think if the criteria that has been used in the past is used against this merger, I think the appropriate authorities will find there will still be plenty of competition left."

In Washington, Sen. Jay Rockefeller (D-W.Va) promised to look into the merger with his Commerce Committee while urging regulators to "leave no stone unturned" in their scrutiny of the merger. “With every passing day, wireless services are becoming more and more important to the way we communicate,” he said in a statement. “So it is absolutely essential that both the Department of Justice and the FCC leave no stone unturned in determining what the impact of this combination is on the American people.”

If the deal fails, AT&T could be stuck with a $3-billion debt to T-Mobile. It could also be forced to hand over spectrum and other considerations, according to Mobilized

Comments     Threshold

This article is over a month old, voting and posting comments is disabled

RE: We need a government cell phone provider.
By Uncle on 3/21/2011 7:01:26 PM , Rating: 1
I guess you were at the head of the parade shouting and praising the government when the government handed out all the welfare cheques (bailouts) to the capitalist because its a system that works.

By torpor on 3/22/2011 2:49:07 PM , Rating: 2
The bailouts weren't about preserving rich companies or CEOs.

Let's see...bailing out the banks protected one of the largest contributors in the last presidental election - Citibank. Forcing the other banks (most of whom did not need help) to take "help" sowed the seeds of control and kept the public from seeing which banks had real trouble and which did not. And FYI, the government has made money on the deal as of right now. So if it makes you feel better, consider it a bonus tax on big business, because that's how it ended up.

Bailing out GM and Chrysler was a favor to the unions, which was another of the big donors. You see, if GM and Chrysler went bankrupt, the union contracts would be dissolved and remade in a sane, sustainable way. Avoiding bankruptcy court prevented that outcome, and ended up with the UAW owning 17% of GM and 65% of Chrysler, effectively ending any chance of union labor costs coming down to internationally-sane levels.

The bailouts were actually, therefore, communism at its worst. Failures in the marketplace need to be allowed to fail - it would have made unsustainable jobs sustainable via the bankruptcy process, and would have been the keystone to a rebuilding of the greater Detroit area.

Instead, it'll be more of the same, but this time with no end in sight. Yay government.

"If you mod me down, I will become more insightful than you can possibly imagine." -- Slashdot
Related Articles

Copyright 2016 DailyTech LLC. - RSS Feed | Advertise | About Us | Ethics | FAQ | Terms, Conditions & Privacy Information | Kristopher Kubicki