AT&T Files Formal Response To Justice Department Lawsuit

Someone needs to tell me what is in the water over at AT&T headquarters that they believe a T-Mobile isn’t competitive. While T-Mobile is certainly the smallest of the big 4 carriers, calling MetroPCS and Cricket a larger threat than a company multiple times the size of both Metro and Cricket combined is in my eyes, irrational.

AT&T filed a formal response to the Department of Justice lawsuit on Friday arguing that competition in the market won’t be affected by their purchase of T-Mobile.

“Although the transaction will remove T-Mobile as an independent competitor, no significant consumer harm will result,” AT&T said in its filing. “The Department does not and cannot explain how, in the face of all of these aggressive rivals, the combined AT&T/T-Mobile will have any ability or incentive to restrict output, raise prices, or slow innovation. Nor can it explain how T-Mobile, the only major carrier to have actually lost subscribers in a robustly growing market, provides a unique competitive constraint on AT&T.”

AT&T goes on to call MetroPCS, Cricket Wireless, Cellular South and U.S. Cellular “innovative upstarts” that present significantly more competitive threats to AT&T’s standing in the wireless market. AT&T further believes that the Justice Department has overlooked how a combined AT&T/T-Mobile will create a more efficient company as a combined carrier. AT&T stresses in their filing that the Justice Department will create a worse situation in the wireless market by not allowing this merger to go forward.

“Without this merger, AT&T will continue to experience capacity constraints, millions of customers will be deprived of faster and higher quality service, and innovation and infrastructure will be stunted. If this transaction does not close due to Plaintiff’s lawsuit, wireless consumers will, as the FCC Chairman predicts, increasingly face higher prices and lower quality.”

Am I the only one who finds the AT&T statements here are a little far fetched? I understand that in order to gain approval they aren’t going to call T-Mobile a serious threat but do they honestly believe the DOJ won’t consider T-Mobile a competitor?


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