Sprint has reacted to yesterday’s news of AT&T’s purchase of T-Mobile and has plainly stated its dissatisfaction with the move, by focusing on competition issues in a statement issued to the media posted below:
“The combination of AT&T and T-Mobile USA, if approved by the Department of Justice (DOJ) and Federal Communications Commission (FCC), would alter dramatically the structure of the communications industry. AT&T and Verizon are already by far the largest wireless providers. A combined AT&T and T-Mobile would be almost three times the size of Sprint, the third largest wireless competitor.”
“If approved, the merger would result in a wireless industry dominated overwhelmingly by two vertically-integrated companies that control almost 80% of the US wireless post-paid market, as well as the availability and price of key inputs such as backhaul and access needed by other wireless companies to compete, The DOJ and the FCC must decide if this transaction is in the best interest of consumers and the US economy overall, and determine if innovation and robust competition would be impacted adversely by this dramatic change in the structure of the industry.”
Sprint was routinely seen as a potential merger partner for T-Mobile as far back as 2006 taking into consideration the size of both operations, even after Sprint’s botched purchase and integration of Nextel, with the latest wave of purchase rumors pegging Sprint and Deutsche Telekom to set up a deal for the American carrier to purchase T-Mobile and merge operations with DT taking a stake in the new company, until yesterday’s shock news. With the possibility of being in a distant third place, Sprint is at risk to lose out on leverage with network equipment and handset manufacturers.
