Everything isn’t coming up roses for AT&T’s plan to merge with T Mobile. The DOJ and the Federal Communication Commission have major concerns about the deal, stating that it could lessen competition in the cellular phone market and cause customers to have to pay higher prices due to that reduction of competition. The DOJ filed a suit in August to stop the deal, and both A T&T and Deutsche Telekom have withdrawn their applications to the FCC and have every intention of reapplying as soon as possible and it’s practical to do so.
The roadblocks are not stopping either company from pursuing the merger, but they are going to concentrate their efforts on getting antitrust clearance for the deal from the DOJ and took the step of withdrawing their applications while they consider all options at the FCC. It’s a strategy move at best and a chance to regroup.
The FCC has three possible ways that they can deal with the application withdrawal requests. They can allow both companies to withdraw their application without any kind of prejudice and allow the companies to reapply when they want to. This is more than likely the route that FCC will go. But other options that the FCC could go with include allowing the proceeding to end with prejudice. That means that the deal is killed because they would not be allowed to reapply later. The last option is that the FCC could go ahead with the hearing and send the case to the administrative law judge and deny the requests to withdraw their petitions. If this is the route they choose, their hearing wouldn’t be until after the DOJ antitrust lawsuit is over.
A T&T does not seem daunted though, and is still trying to push the deal through and is not showing signs of pulling out until the very end. It could be the end of Feb or into March before A T&T gives up altogether, if they do, while they wait for the DOJ to decide what they’re going to do with their lawsuit.
If this deal does fall through, companies like MetroPCS and Leap have got to watch their backs, because the likelihood is that T Mobile would turn its attentions towards those markets. If A T&T’s deal goes through, MetroPCS would more than likely benefit as customers look for alternatives rather than staying with A T&T and their too high monthly rates.
It could be a very long road for T Mobile as it navigates its way through the uncertain waters ahead. At any rate, T Mobile customers and employees really do deserve for this to be over one way or the other. Many opposed the merger from the start, not wanting to have to stay with A T&T and the weakening of the deal makes many happy. The bad part is that T Mobile is still going the wrong way in terms of its fortunes. Unfortunately while the A T&T deal drags on, T Mobile is still nothing but a pawn to A T&T. Let’s hope for the sake of their customers, that it is all resolved soon.
- AT&T Desperate To Save T-Mobile Bid (informationweek.com)
- AT&T withdraws FCC application for T-Mobile merger (bgr.com)
- AT&T, Deutsche Telekom withdraw FCC application for T-Mobile merger, look toward DoJ (engadget.com)