AT&T to Justice Department: We Need T-Mobile

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AT&T has responded to the U.S. Justice Department’s lawsuit aiming to block the buyout of T-Mobile by saying without the merger customers will face network capacity issues and even higher prices.

AT&T said in its response, according to Phone Scoop,

Without this merger, AT&T will continue to experience capacity constraints, millions of customers will be deprived of faster and higher quality service, and innovation and infrastructure will be stunted. If this transaction does not close due to Plaintiff’s lawsuit, wireless consumers will, as the FCC Chairman predicts, increasingly face higher prices and lower quality.

The Justice Department filed a lawsuit in August as a move to block AT&T’s planned purchase of T-Mobile arguing that merging the carriers would limite cell service competition, and would negatively impact the wireless service market.

Hey, DOJ, don't bring us down, man!AT&T to DOJ: No, really, this is a good deal!

“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.

The DOJ argued that T-Mobile is a major player in the U.S. cell service market, and that rural areas would be worse off without T-Mobile. AT&T, however, disagreed.

“The Department does not and cannot explain how, in the face of all of these aggressive rivals, the combined AT&T/T-Mobile will have any ability or incentive to restrict output, raise prices, or slow innovation,” AT&T said in its response. “Nor can it explain how T-Mobile, the only major carrier to have actually lost subscribers in a robustly growing market, provides a unique competitive constraint on AT&T.”

AT&T announced its plan to buy T-Mobile USA from Deutsche Telekom in March for about US$39 billion. At the time, AT&T said the deal would “provide an optimal combination of network assets to add capacity sooner than any alternative, as well as provide an opportunity to improve network quality in the near term for both companies’ customers.”

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4 Comments

daemon

Yes…. AT&T needs T-mobile so bad, else they’ll actually have to build towers and start using all that spectrum they’ve got sitting around unused. I mean, imagine the cost to AT&T to do that! AT&T did, and they said it’ll be about $3.8 billion dollars! That’s almost 10% of what they’re spending to buy T-mobile! How can AT&T possibly compete without buying out T-mobile?!

jestar

So, this puts AT&T customers in a bind, if the merger doesn’t go through we’ll have to raise prices. If it does go through we can lower prices…......until the competition can no longer afford to be in the game, then we’ll raise prices because we can, and you won’t have a choice.

Damned if they do, damned if they don’t!

Reset

Seriously- AT&T doesn’t want any competition. It truly is looking to undermine all other networks by forcing this issue on the Department of Justice. What makes this more tasteless is having Republican Tea Party Senators confronting the Justice Department on behalf of AT&T. Bully Pulpit - Disgusting.

Gabe

ATT, upgrade your infurstructure to compete.  You have enough cash to do something good for once for your customers.  Stop lying about the reason, you just don’t want to do the manual work to upgrade your network.  You just want to monoplized the industry and charge more for less.  The merger should never be allowed.  Remember baby bells, the breakup of ATT, well it made you a better company and a more profitable caompany.

Thanks

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