Sprint sues to block AT&T, T-Mobile merger

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Sprint sues to block AT&T, T-Mobile merger

Following in the footsteps of last week’s Justice Complaint arguing against AT&T’s proposed acquisition of T-Mobile USA, Sprint has filed a suit seeking to block the transaction. According to a Sprint press release, the lawsuit was filed against AT&T, AT&T Mobility, Deutsche Telekom, and T-Mobile in Washington D.C. as a related case to the Department of Justice’s suit, and focuses on the “competitive and consumer harms” which would result from the merger. The company argues that those include higher prices and less innovation, a further entrenchment of the AT&T and Verizon “duopoly”—the transaction would give the two carriers more than three-quarters of the market and 90 percent of the profits—and a further weakening of the market position of Sprint and other independent wireless carriers.

“Sprint opposes AT&T’s proposed takeover of T-Mobile,” said Susan Z. Haller, vice president of Litigation for Sprint. “With today’s legal action, we are continuing that advocacy on behalf of consumers and competition, and expect to contribute our expertise and resources in proving that the proposed transaction is illegal.”

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Comments

1

This makes sense. Sprint seeks to play in the value segment of the market. AT&T and Verizon have aimed for the premium market segment. By objecting to the T-Mobile acquisition, Sprint is angling to have T-Mobile lose marketshare by being stuck in the middle with no particular value proposition.

Posted by Charles Farley on September 7, 2011 at 6:02 AM (PDT)

2

Charles, by your argument, Sprint is trying to edge Tmobile out of a particular “buyer” segment. If so, then Tmobile loses business and perhaps is forced out of business altogether. A weaker (or cheaper) Tmobile would be an easier buy by ATT as they could state to the FTC that they are keeping jobs available by purchasing Tmobile. Ultimately, Tmobile would be removed and there would still be a consolidation of phone/cellphone providers. ATT would still end up with Tmobile’s network, which it wants for expanded iPhone use(ATT does not want to spend the money to upgrade their own network, it should be noted). This would not be good for Sprint. I further think that Apple and the iPhone are driving part of this recent sale as people want the iPhone. My question is why hasn’t Sprint come to some agreement to sell apple products via their network as well? Apple is driving this competition and potential consolidation of phone/cellphone providers.

Posted by kevin davis on September 8, 2011 at 11:31 AM (PDT)

3

I believe Sprint is getting the iPhone according to the Sept 4 - Boy Genius Report.

Posted by Charles Farley on September 8, 2011 at 4:41 PM (PDT)

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