Statement of Deputy Attorney General James M. Cole, U.S. Justice Department:
Good morning. Millions of Americans rely on mobile wireless telecommunications services in their everyday lives. Whether you are a parent using a cell phone to check up on your teenager or a working professional using a laptop or smart phone to conduct business or surf the web, mobile wireless communications plays a vital – and increasing – role in our daily lives.
We all reap the benefits of this incredible technology because there has been fierce competition in this industry, which has brought all of us innovative and affordable products and services.
In order to ensure that competition remains and that everyone – including consumers, businesses and the government – continues to receive high quality, competitively priced mobile wireless products and services, the Department of Justice today filed an antitrust lawsuit in U.S. District Court in Washington, D.C. to block AT&T’s acquisition of T-Mobile.
The Department filed its lawsuit because we believe the combination of AT&T and T-Mobile would result in tens of millions of consumers all across the United States facing higher prices, fewer choices and lower quality products for their mobile wireless services.
Consumers across the country, including those in rural areas and those with lower incomes, have benefitted from competition among the nation’s wireless carriers, particularly the four remaining national carriers. This lawsuit seeks to ensure that everyone can continue to reap the benefits of that competition.
Right now, four nationwide providers account for more than 90 percent of the mobile wireless connections in America, and preserving competition among them is crucial. For instance, AT&T and T-Mobile currently compete head-to-head in 97 of the nation’s largest 100 cellular marketing areas. They also compete nationwide to attract business and government customers. Were the merger to proceed, there would only be three providers with 90 percent of the market, and competition among the remaining competitors on all dimensions-including price, quality, and innovation-would be diminished.
As can be seen in the Department’s complaint, AT&T felt competitive pressure from T-Mobile. One example cites an AT&T employee observing that “[T-Mobile] was first to have HSPA+ devices in their portfolio…we added them in reaction to potential loss of speed claims.”
So as you can see, a merged AT&T and T-Mobile would combine two of the four largest competitors in the marketplace, and would eliminate T-Mobile, an aggressive competitor, from the market.
Although there has been a leadership change in the Antitrust Division, one thing has not changed – the Division will remain steadfast in its mission to vigorously enforce the antitrust laws.
And that’s what the Department has done today. The leadership transition has been seamless and the right decision was reached in this case.
We are seeking to block this deal in order to maintain a vibrant and competitive marketplace that allows everyone to benefit from lower prices and better quality and innovative products.
I want to express my own deep gratitude for the efforts of so many members of the Antitrust Division staff who have tremendous expertise in this important industry. And Sharis, I want to thank you for your leadership in this effort. You and your team have done the right thing for consumers.