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US DoJ sues AT&T over T-Mobile USA buyout
AGGRESSIVE US TELECOMS GIANT AT&T has suffered a blow to its plans to take over T-Mobile USA, as the US Department of Justice (DoJ) has sued the company to block the deal.
Earlier this year AT&T announced its plan to purchase Deutsche Telekom's T-Mobile USA for $39bn, a move that would cut the number of US mobile operators down to three. Since then AT&T has lobbied for public and political support, repeatedly saying that the deal would be good for customers, even if it meant some of them would only have the option of AT&T, and it even sued the law firms that represented customers who oppose the merger.
Now the US DoJ has filed an antitrust lawsuit against AT&T over the merger, claiming that any deal would "substantially lessen competition" in the US wireless market. It added that "AT&T's elimination of T-Mobile as an independent, low-priced rival would remove a significant competitive force from the market," something that most US customers might say is stating the bleedin' obvious.
AT&T on the other hand seems to have been caught off guard, with Wayne Watts, AT&T's general counsel telling Bloomberg, "We have met repeatedly with the DoJ and there was no indication from the DoJ that this action was being contemplated." T-Mobile's parent firm was a little more forceful in its statement, saying, "[The] DoJ failed to acknowledge the robust competition in the U.S. wireless telecommunications industry and the tremendous efficiencies associated with the proposed transaction."
The DoJ antitrust suit essentially forces AT&T and T-Mobile to negotiate with the DoJ, which has final approval of all US mergers. AT&T's initial bid for T-Mobile USA included a cancellation fee of $3bn, so there is plenty of incentive for the firms to sit around the table and hammer something out.
While AT&T's plan to overtake Verizon by buying T-Mobile isn't dead, the DoJ's decision to file an antitrust lawsuit is a major setback and might scuttle the deal. µ
Tags: Hardware
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It appears that while The US Federal Trade Commission is 'somewhat' involved, this action apparently was not instigated by them and referred to the DOJ like I thought would have been the normal procedure, so it's business as usual for the FCC being minions for the big telecoms.
I'm sure the cancer began to spread much earlier, but at least since 2000, after George W. Bush first took office, US government anti-monopoly actions have completely vanished. Ranked only after banks and the healthcare industry, US telecoms are next in line for being the greediest anti-competition cutthroat bastards, period. This is just another example. Instead of AT&T improving and expanding their infrastructure to maintain as well as lure new customers (God forbid!), they would rather buy out the competition to keep phone and data rates in the stratosphere while keeping their poorly maintained under-capacity network as is, hence continuing to provide sub-standard service.
I can honestly say that I have NEVER experienced a corporate buyout of another major competitor that resulted in lower fees and/or better service for customers. Conversely, it has always resulted in higher fees and worse service. Let me qualify this by saying I ain't no spring chicken. I'm also a former AT&T customer (and victim, thereof) and as everyone knows...THEY EFFING SUCK!!!
I don't know who woke up the US Federal Trade Commission, but I do hope they see this thing through. God knows it's way overdue for them to actually do their frickin' job!