Sprint plans to appeal AT&T acquisition of T-Mobile

By on March 24, 2011, 2:27 AM
Sprint Nextel CEO Dan Hesse has declared that his company plans to submit its worries over AT&T's acquisition of T-Mobile to Congress. At a wireless industry conference in Orlando, Florida, Hesse explained that he believes the deal would hurt the wireless industry as the combined company would have "tremendous" power. "I have concerns it would stifle innovation," Hesse said. AT&T, for its part, is taking the complaint in stride.

"We understand Sprint has concerns, and we'll be happy to address any they present, whether at the Justice Department, the FCC or the Congress," Jim Cicconi, senior executive vice president at AT&T, told Bloomberg. "We feel we have good and compelling answers. And we feel policymakers will readily understand that any company with whom AT&T competes may not be especially positive about anything which makes AT&T a better competitor in the wireless market."

Late last week, AT&T announced that it had entered into a definitive agreement to acquire T-Mobile USA from Deutsche Telekom in a cash-and-stock transaction valued at approximately $39 billion. AT&T and Verizon Wireless would hold 79 percent of the US market if regulators approved the deal, leaving Sprint as an even weaker number three player in the US.

Earlier this week, Verizon Wireless CEO Daniel Mead denied that his company was interested in Sprint and, at the same time, said he would not oppose the AT&T takeover of T-Mobile, which still needs to receive regulatory approval. Sprint, on the other hand, will do everything it can to see a rejection from US regulators.

The US House Judiciary Committee said yesterday it will hold a hearing in regards to the deal to look into possible anticompetitive impacts. Frankly, we'll be surprised if the acquisition isn't delayed, at the very least.

User Comments: 3

Got something to say? Post a comment
yRaz yRaz said:

AT&T has the worst policy of any wireless company. On top of that, this is the most uncompetitive thing they could do. This will only strengthen the hold that AT&T has on our wallets. Just look at the price of your bill, they couldn't give a damn about who they are competing with, no wonder sprint is worried.

Guest said:

Should this acquisition go thought, it will be a disaster to the wireless marketplace. It will stifle innovation and cause ridiculous pricing. This of all the towers that AT&T owns and those that T-Mobile owns...now those small companies use those towers for there own clients. Think what would happen when AT&T decides to jack up the rate for those small wireless companies? BAM! prices skyrocket and the small companies either sell or go out of business.

MrAnderson said:

I would like this to go through, but my major concern is the exclusivity of headsets and contract length.

AT&T customers need better coverage; this should pretty much fix that. Verizon was allowed to get big when the acquired Alltel, thus, AT&T should be able too do the same. As a consequence they will be watched and the ever present threat to break them up again might keep them honest.

To be honest, even when all the companies were separate, there were little changes in the business model and services.

Little has changed ? headset exclusivity is still used to get customers. This takes precedence over improving service functionality features and the price put on service plans are very similar.

Regulation should discourage headset exclusivity, but that will be moot since both big companies now have two different phone chips, CDMA and GSM.

That is now my problem. Maybe regulation needs to force the use of both technologies so headset can be free! That is what we need, headsets be free. They can have a headset for a limited amount of time, but customers can take it to another company if they change the service provider. These two year contracts are crap too. With less competition they need to whack these long contracts too.

Load all comments...

Add New Comment

TechSpot Members
Login or sign up for free,
it takes about 30 seconds.
You may also...
Get complete access to the TechSpot community. Join thousands of technology enthusiasts that contribute and share knowledge in our forum. Get a private inbox, upload your own photo gallery and more.