1 Comment

Summary:

Just because the Department of Justice and Sprint are suing to stop AT&T from buying T-Mobile, doesn’t mean the deal is dead. Analyst firm Strategy Analytics today said it thinks the deal could still happen if AT&T sells off some of its spectrum.

istock_000015745684xsmall

Just because the Department of Justice and Sprint are suing to stop AT&T from buying T-Mobile, doesn’t mean that AT&T is giving up, nor does it mean the deal is dead. Analyst firm Strategy Analytics today said it thinks the deal could still happen if AT&T sells off some of its spectrum and, “persuades Deutsche Telekom to be patient.”

I don’t know if I share the firm’s optimism, since the DoJ doesn’t interfere lightly in deals–in fact in the last decade it has only filed suit to stop two telecommunications mergers — both of which were dropped. However, Sue Rudd at Strategy Analytics believes the DoJ is going back to the more distant past:

“The recent DoJ intervention to block the acquisition represents a return to pre-2000 antitrust enforcement. The DoJ review of the AT&T T-Mobile acquisition may be compared to the 2000 GTE Verizon deal which took 23 months to complete and required many DoJ-requested modifications. AT&T still has strong national competition. The potential problems are in specific Cellular Market Areas (CMAs).”

Areas the DoJ thinks spectrum ownership is too concentrated include Dallas, Houston, Oklahoma City, Okla., Birmingham, Ala., Honolulu, Hawaii and Seattle.

However Strategy Analytics’ optimism doesn’t stretch to AT&T getting the deal done before the March 2012 deadline set by Deutsche Telekom, so AT&T will have to convince T-Mobile’s parent to stick with it instead of forcing Ma Bell to pay the breakup fee. Given how surprised Deutsche Telekom was by the move perhaps it will stay the coure. Plus, the judge hearing the DoJ suit yesterday set Sept. 21 as the first date for AT&T and the DoJ to meet in the court.

  1. Most countries… even tiny countries with a population of just a few million, can support at least 3 nationwide mobile networks.

    You’d think that the United States, with 300 million people, could support many more national mobile networks. Why is that not possible?

    Share

Comments have been disabled for this post