By Ed Oswald | Tuesday, May 3, 2011 at 4:26 pm
The Justice Department has sent a second round of questions on the proposed merger of AT&T and T-Mobile to the two companies, sources told Bloomberg on Tuesday. In addition, so-called “civil investigative demands” have also been sent to the companies’ competitors, in an attempt to measure the mergers possible effects.
With these actions, the merger review now has no timetable for completion — which means AT&T and T-Mobile’s stated goal to get the review completed within a year could be in serious jeopardy. It also highlights the complexity of the situation, and how difficult it might be for the deal to win approval.
Neither T-Mobile nor AT&T are commenting on the DOJ’s decision — anything they say could be used against them. But with the fact of the matter being that the merger significantly limits competition in many markets, the decision is probably a good thing.
I know AT&T especially has been fond of saying how most markets have “five or more” wireless competitors. In most cases, however, the only truly worthwhile ones are the big four. So using that as a reason to approve the merger seems to ring just a bit hollow for me.
Ultimately, I’m in favor of the merger happening, if the right restrictions are imposed–T-Mobile customers really do stand to gain far more (especially in the service department) than they would lose. But our regulators should take the time to ensure that an AT&T-Mobile won’t end up doing more harm than good.
I know some of our readers have some very strong opinions against this, and I’m sure we’ll see more of them in the comments to this story. I invite the discussion, which I’m sure similar ones are occurring in the halls of the DOJ’s antitrust division right now.