Sprint, others ask FCC to deny AT&T deal for T-Mobile

Thousands of consumers ask the agency to kill the $39 billion acquisition

Sprint Nextel, joined by an army of thousands of consumers, have filed requests for the U.S. Federal Communications Commission to block AT&T's proposed acquisition of rival mobile carrier T-Mobile USA.

The US$39 billion acquisition would create a "Twin Bell duopoly," giving AT&T and Verizon Communications a combined 82 percent of the mobile market in the country, Sprint said Tuesday. Approval of the acquisition would take the U.S. mobile market back to the 1980s, when only two carriers had mobile licenses in each area, Sprint said in its 377-page filing.

The FCC's spectrum auctions in the 1990s "gave rise to Sprint, T-Mobile, and other wireless carriers, and ushered in an era of competition and growth that has greatly benefitted consumers," Sprint's representatives wrote. "Wireless competition has sparked a technological revolution in broadband data services, applications and devices. The proposed transaction would turn back the clock on competition and innovation and bring this era of unprecedented wireless expansion and technological innovation to an abrupt, but avoidable, halt."

Sprint has opposed the deal since the companies announced it in March. The deal would merge the second largest mobile carrier in the U.S. with the fourth largest, creating a new leader.

AT&T has argued that it needs T-Mobile's spectrum to keep up with growing demand for mobile broadband service. Sprint disputed that argument, saying AT&T already controls the most spectrum of any U.S. mobile carrier. AT&T is the "industry laggard" in deploying next-generation mobile broadband, a source close to Sprint said Tuesday.

AT&T noted that "dozens" of groups, including labor unions, politicians and community and minority groups, have voiced support for the deal. "We anticipate additional support for the transaction from more voices who recognize the tremendous benefits for the economy, innovation and public policy associated with bringing high-speed wireless broadband deployment to more than 97 percent of the U.S. population -- nearly 55 million more Americans than our pre-merger plans -- and improving call quality and network performance for consumers," an AT&T spokeswoman said.

The FCC has received more than 10,000 comments about the proposed merger, with many mobile customers submitting one-page form letters from media reform group Free Press in opposition to the deal.

"If you even bother to read this, I have a reminder for you; the reason you got into politics in the first place -- to serve the people," one person wrote. "Corporations aren't people. Go get your backbone and integrity out of the closet, dust 'em off, and wear them proudly. Try to remember who you serve."

Several groups have filed comments in support of the deal before the Tuesday deadline for petitions to deny the acquisition.

"The result of the proposed merger of T-Mobile and AT&T is expected to be near-universal access to broadband Internet service," wrote J.R. Jones, president and CEO of the Mississippi Black Chamber of Commerce. "We expect the minority businesses we represent to be some of the primary beneficiaries of this expanded network commitment."

AT&T has said the deal will allow it to expand mobile broadband service to 97 percent of the U.S. population.

The Maritime Trades Council of Greater Boston and New England AFL-CIO wrote in support of the merger because it would allow T-Mobile employees to join unions, as AT&T employees have been able to do for years.

"This merger will not just benefit T-Mobile's workers, it will also help grow the broader economy," the council wrote. "For our members, communication is critically necessary to safely and effectively execute our jobs, so we certainly appreciate the need to upgrade coverage and increase speed, which this transaction will accomplish."

Grant Gross covers technology and telecom policy in the U.S. government for The IDG News Service. Follow Grant on Twitter at GrantGross. Grant's e-mail address is grant_gross@idg.com.

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Tags business issuesantitrustfree presstelecommunicationMergers / acquisitionsregulationmobilegovernmentT-Mobile USACarriersat&tlegalU.S. Federal Communications Commissionsprint nextel

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Grant Gross

IDG News Service
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