AT&T T-Mobile Merger Shot Down by Anti-Trust Laws

It looks like the AT&T merger with T-Mobile may not happen thanks to the US Justice Department. Thousands of complaints and discussions have happened  since the original announcement of the acquisition back in March regarding the destruction of competition in the cellular market this would cause. The suit filed earlier today basically claimed this would breach Anti-trust laws, meaning it would create a market where there is a lack of competition.

AT&T T-Mobile

Wayne Watts of AT&T responded:

“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 LTE 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.”

Deutsche Telekom (Parent of T-Mobile) had this to say:

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.

The Company 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.

 

Long story short; AT&T will sue… it will be moved around in the court system, and it will be bumped out. Thankfully, we’ll have a more competitive market now. If T-Mobile doesn’t make a huge stink about this and doesn’t mess with their current plans, they’ll be in a lot better shape.

Shane Paris

​Shane is the founder and Technical Editor-in-Chief here at That's It Guys. He enjoys Star Trek, 80s and 90s action movies, and everything tech related. Shane is highly skilled with computer hardware, software, and electronics.