“font-family: Verdana, Times, serif; font-size: 12px; text-decoration: none; line-height: 13px; color: #000000; font: normal normal normal 12px/normal verdana, helvetica, arial;”>
“font-family: Arial, Helvetica, sans-serif; font-size: 13px; -webkit-border-horizontal-spacing: 2px; -webkit-border-vertical-spacing: 2px;”>
WASHINGTON (AP) — AT&T is countering the U.S. government’s
attempt to block its $39 billion acquisition of T-Mobile by
depicting the deal as a way to provide consumers with better cell
phone service at lower prices.
“font-family: Verdana, Times, serif; font-size: 12px; text-decoration: none; line-height: 13px; color: #000000; font: normal normal normal 12px/normal verdana, helvetica, arial;”>
“font-family: Arial, Helvetica, sans-serif; font-size: 13px; -webkit-border-horizontal-spacing: 2px; -webkit-border-vertical-spacing: 2px;”>
The argument, submitted in a Friday court filing, is AT&T
Inc.’s first legal response to a lawsuit that the Department of
Justice filed last week in an effort to ensure T-Mobile remains
independent. AT&T’s 25-page document echoed the company’s
previous contention that buying rival T-Mobile will enable it to
expand its mobile communications network so there are fewer dropped
connections in a world where constant online access is becoming the
norm.
“font-family: Verdana, Times, serif; font-size: 12px; text-decoration: none; line-height: 13px; color: #000000; font: normal normal normal 12px/normal verdana, helvetica, arial;”>
“font-family: Arial, Helvetica, sans-serif; font-size: 13px; -webkit-border-horizontal-spacing: 2px; -webkit-border-vertical-spacing: 2px;”>
The Justice Department believes there wouldn’t be enough
competition if AT&T devours T-Mobile, creating a void that
would increase prices and reduce the incentive to develop new
technology.
“font-family: Verdana, Times, serif; font-size: 12px; text-decoration: none; line-height: 13px; color: #000000; font: normal normal normal 12px/normal verdana, helvetica, arial;”>
“font-family: Arial, Helvetica, sans-serif; font-size: 13px; -webkit-border-horizontal-spacing: 2px; -webkit-border-vertical-spacing: 2px;”>
AT&T’s lawyers contend that the Justice Department’s analysis
reflects a misunderstanding of the market. They say T-Mobile, the
fourth largest cell phone carrier with 33.6 million customers,
isn’t a significant competitive threat to AT&T, the No. 2
carrier with nearly 100 million customers. T-Mobile has been losing
market share in recent years, a trend that AT&T argues will
discourage its German parent, Deutsche Telekom, from investing to
improve its own wireless network.
“font-family: Verdana, Times, serif; font-size: 12px; text-decoration: none; line-height: 13px; color: #000000; font: normal normal normal 12px/normal verdana, helvetica, arial;”>
“font-family: Arial, Helvetica, sans-serif; font-size: 13px; -webkit-border-horizontal-spacing: 2px; -webkit-border-vertical-spacing: 2px;”>
In contrast, AT&T says it spent more than $30 billion in
network upgrades from 2008 through 2010, yet still can’t keep up
with customers’ growing demand to transfer data over phones and
other wireless devices, according to the court documents. But if it
can snap up T-Mobile, AT&T believes the added capacity will put
it in a better position to deliver better services. AT&T
already has pledged to invest at least $8 billion and transfer
5,000 jobs currently in overseas call centers back to the U.S. if
the T-Mobile purchase goes through.
“font-family: Verdana, Times, serif; font-size: 12px; text-decoration: none; line-height: 13px; color: #000000; font: normal normal normal 12px/normal verdana, helvetica, arial;”>
“font-family: Arial, Helvetica, sans-serif; font-size: 13px; -webkit-border-horizontal-spacing: 2px; -webkit-border-vertical-spacing: 2px;”>
The court filing also seeks to counter the Justice Department’s
theory that the U.S. cell phone market would be dominated by just
three carriers – AT&T, Verizon Wireless and Sprint Nextel Corp,
if T-Mobile disappears from the market. AT&T’s filing cites
“innovative upstarts” MetroPCS and Leap/Cricket and regional
carriers such as US Cellular and Cellular South as viable
alternatives for most consumers.
“font-family: Verdana, Times, serif; font-size: 12px; text-decoration: none; line-height: 13px; color: #000000; font: normal normal normal 12px/normal verdana, helvetica, arial;”>
“font-family: Arial, Helvetica, sans-serif; font-size: 13px; -webkit-border-horizontal-spacing: 2px; -webkit-border-vertical-spacing: 2px;”>
“The (Justice) Department does not and cannot explain how, in the
face of all these aggressive rivals, the combined AT&T/T-Mobile
will have any ability or incentive to restrict output, raise
prices, or slow innovation,” the AT&T’s lawyers
wrote.
“font-family: Verdana, Times, serif; font-size: 12px; text-decoration: none; line-height: 13px; color: #000000; font: normal normal normal 12px/normal verdana, helvetica, arial;”>
“font-family: Arial, Helvetica, sans-serif; font-size: 13px; -webkit-border-horizontal-spacing: 2px; -webkit-border-vertical-spacing: 2px;”>
It’s unusual for the Justice Department to challenge a proposed
acquisition in court. Most companies back out of deals to avoid
tangling with the government. But AT&T has a huge incentive to
fight: It will have to pay a $3 billion termination fee if its
agreement with T-Mobile unravels.
“font-family: Verdana, Times, serif; font-size: 12px; text-decoration: none; line-height: 13px; color: #000000; font: normal normal normal 12px/normal verdana, helvetica, arial;”>
“font-family: Arial, Helvetica, sans-serif; font-size: 13px; -webkit-border-horizontal-spacing: 2px; -webkit-border-vertical-spacing: 2px;”>
The first hearing in the case is set for Sept. 21 in Washington
before U.S. District Court Judge Ellen Huvelle.
“font-family: Verdana, Times, serif; font-size: 12px; text-decoration: none; line-height: 13px; color: #000000; font: normal normal normal 12px/normal verdana, helvetica, arial;”>
“font-family: Arial, Helvetica, sans-serif; font-size: 13px; -webkit-border-horizontal-spacing: 2px; -webkit-border-vertical-spacing: 2px;”>
AT&T, which is based in Dallas, is seeking a quick resolution
to the case.
“font-family: Verdana, Times, serif; font-size: 12px; text-decoration: none; line-height: 13px; color: #000000; font: normal normal normal 12px/normal verdana, helvetica, arial;”>
“text-decoration: none; color: #000066;” rel=”item-license” name=
“786fb7e7-2094-4cd9-9c6a-f1c4889d2b4d” href=
“http://hosted.ap.org/dynamic/stories/U/US_ATT_T_MOBILE_LEGAL_CHALLENGE?SITE=AP&SECTION=HOME&TEMPLATE=DEFAULT&CTIME=2011-09-09-19-36-17#786fb7e7-2094-4cd9-9c6a-f1c4889d2b4d”> © 2011 The
Associated Press may not be published, broadcast, rewritten or
redistributed. “http://hosted2.ap.org/APDEFAULT/privacy”>Privacy
Policy
