announced its intent to buy T-Mobile
for $39 billion from Deutsche Telekom, a deal that would marry the world's second and fourth largest wireless carriers. It would also reduce the wireless playing field to just three, with AT&T on top followed by Verizon
. Would this be a good thing for consumers? Not according to Sprint, which had plenty to say on the matter.
"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," Sprint said in a statement. "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."
Sprint, which acquired Nextel in 2005 for $35 billion in an attempt to close the gap between itself and the other wireless carriers, fears AT&T's $39 billion acquisition of T-Mobile would effectively push it right out of the park, let alone off the playing field.
"If approved, the merger would result in a wireless industry dominated overwhelmingly by two vertically-integrated companies that control almost 80 percent 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," Sprint said. "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."
Verizon so far has refrained from speaking publicly about the deal, though it's still early. With all of the red tape to sift through, the merger isn't expected to take place for another 12 months.