Mobile Merger in Jeopardy

Mobile Merger in
Jeopardy The merger of AT& T and T -Mobile ran into a
snag today when the U .S . Department of
Justice ( DOJ) claimed it would violate U . S.
antitrust laws . The DOJ believes it will harm
the competitiveness of the wireless industry.
The $ 39 billion acquisition was on track to be
finalized in early 2012 so this decision came
as a shock to AT& T . They said they were
“surprised and disappointed” by the filing.
Sprint Nextel Corp . has lobbied against this
merger for months, stating it will harm
consumers through higher prices and lower
device options. Sprint asked the government
to block the deal back in March, and filed a
formal petition with the FCC in May.
Some analysts believed the merger was
doomed from the start. To try and minimize
the risk of the deal falling apart, AT& T
promoted the merger as one that would
benefit consumers by spreading 4 G ( LTE )
across the country faster than if the two
companies remained separate .
This ruling is not permanent , as it can be
renegotiated and resubmitted for approval .
Jeff Kagan, an independent telecom analyst
believes the government is saying the deal will
not be approved the way it is currently
structured.
So this means AT& T will need to make some
concessions, and they have indicated in the
past that they would be willing to do so to
make this merger happen .
The Communications Workers of America
(CWA ) is speaking out against the decision of
the DOJ, stating this deal was going to create
good jobs and bring better Internet
technology to rural areas . The CWA cited the
AT& T announcement which claims they will
bring 5 ,000 jobs, which were once
outsourced, back into the U .S .
If the deal does fall apart , AT& T may have to
pay $ 3 billion in breakup fees to T -Mobile .
Mobile Merger in
Jeopardy