Several state attorneys general have expressed concerns that AT&T's (NYSE:T) proposed purchase of T-Mobile USA for $39 billion will harm competition in the wireless market, ratcheting up pressure on AT&T as it embarks on a lobbying effort to push the deal through.
The most high-profile skepticism came from New York Attorney General Eric Schneiderman, who said he will place the deal under a "thorough review" to assess its impact on New York's wireless market. "Cell phones are no longer a luxury for a few among us, but a basic necessity," he said in a statement. "The last thing New Yorkers need during these difficult economic times is to see cell phone prices rise."
Separately, Connecticut Attorney General George Jepsen said the deal "clearly raises concerns" and said Connecticut will consult with the Department of Justice and other states to see how to review the deal. Minnesota Attorney General Lori Swanson said she also will review the deal.
AT&T said it expects some states to request information on the deal. "We will respond in an appropriate and timely manner to such requests," an AT&T spokesman told the Wall Street Journal. "We are currently reviewing whether any state notices, information filings or reviews, if any, will be required regarding this transaction, but no final decisions have been made regarding this issue."
Sprint Nextel (NYSE:S) said Monday it will not accept the transaction under any circumstances; the carrier said if the deal goes through it will concentrate far too much power in the hands of AT&T and Verizon Wireless (NYSE:VZ). Verizon has said it is not opposed to the deal, though other operators have expressed concerns, as have a number of consumer interest groups.
Meanwhile, AT&T CEO Randall Stephenson continued to defend the deal, and said he thinks he sees "good signs" from the Obama administration. The FCC and Department of Justice must review the deal.
"This industry is anything but a duopoly," Stephenson said at a conference in New York City hosted by the Council on Foreign Relations, arguing that the deal will be reviewed on a market-by-market basis. "The industry is intensely competitive now, and will be intensely competitive after the deal."
- see this WSJ article (sub. req.)
- see this NYT article
- see this Dow Jones Newswires article (sub. req.)
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