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Sprint backs government suit to block AT&T takeover of T-Mobile

September 1, 2011 |  8:58 am

Sprint: Sprint supports a Department of Justice suit to block the AT&T takeover of T-Mobile

Sprint has been among the most vocal opponents of AT&T's proposed $39-billion takeover of T-Mobile USA pretty much since the deal was announced.

On Wednesday, the third-largest wireless carrier in the U.S. unsurprisingly came out in support of the Department of Justice's antitrust lawsuit that is looking to block AT&T's purchase of T-Mobile from Germany's Deutsche Telekom.

"The DOJ today delivered a decisive victory for consumers, competition and our country," Vonya B. McCann, senior vice president of government affairs for Sprint, said in a statement. "By filing suit to block AT&T's proposed takeover of T-Mobile, the DOJ has put consumers' interests first. Sprint applauds the DOJ for conducting a careful and thorough review and for reaching a just decision -- one which will ensure that consumers continue to reap the benefits of a competitive U.S. wireless industry. Contrary to AT&T's assertions, today's action will preserve American jobs, strengthen the American economy, and encourage innovation."

In March, shortly after AT&T announced that it had agreed to buy T-Mobile, Sprint formally objected to the deal. In May, Sprint asked the FCC to block the transaction, arguing that it would result in a less competitive wireless market -- one where a combined AT&T and T-Mobile would dwarf the rest of the industry.

Currently, the big four of Verizon, AT&T, Sprint and T-Mobile control about 90% of the U.S. wireless market.

For its part, AT&T says it believes its takeover of T-Mobile would create jobs in the U.S. and allow it to meet consumer demand faster than if it proceeded on its own. AT&T said it was surprised by the Justice Department suit.

In the suit, the government contends that combining AT&T, the nation's second largest carrier, a and T-Mobile, the fourth largest carrier, would result in not only less competition among wireless carriers, but also increased prices, poor-quality services and fewer innovative products being developed.

The suit also expressed concern that as many as 20,000 jobs would be lost if AT&T consumed T-Mobile due to the redundancies in the two companies' operations and staff.

AT&T has said it will fight the Justice Department suit in court.

RELATED:

Justice Department sues to block AT&T takeover of T-Mobile

AT&T surprised by Justice Department antitrust suit over T-Mobile deal

Justice Department fears lost jobs if AT&T takeover of T-Mobile is approved

-- Nathan Olivarez-Giles

twitter.com/nateog

Photo: A Kyocera Corp. Echo smartphone at a Sprint store. Credit: Bloomberg

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