After the U.S. Department of Justice filed an antitrust lawsuit last week to block AT&T’s (NYSE:T) planned $39 billion acquisition of T-Mobile, Sprint (NYSE:S) filed with its own lawsuit to block the deal this week. In its lawsuit, Sprint mentioned that if the deal goes through, it would harm consumers and weaken Sprint’s ability to compete with AT&T and Verizon (NYSE:VZ). On the other hand, AT&T is preparing to make concessions to address concerns raised by the DoJ.
Verizon launched some high profile smartphones this week which include Motorola Mobility’s (NYSE:MMI) Droid Bionic and Research in Motion‘s (NASDAQ:RIMM) BlackBerry Torch 9850. [1]
Sprint
Sprint has vehemently opposed the AT&T/T-Mobile deal saying that it could put the rest of the telecom industry at the mercy of AT&T and Verizon. Sprint argued that the deal would make the U.S. wireless market an effective duopoly, and one of the effects would be that Sprint would not have access to the best wireless handsets, an important parameter in attracting subscribers in the U.S. wireless market.
See Sprint Jumps on the Dog Pile and Sues AT&T.
AT&T
To address concerns raised by the Department of Justice that the T-Mobile deal is anti-competitive, AT&T may have to sell up to 25% of T-Mobile’s business, including spectrum and customers.
In another twist, AT&T could lower the price it pays for T-Mobile if its required concessions become too expensive, a Bloomberg report said, citing sources with direct knowledge of the deal. AT&T would be able to reduce the original $39 billion purchase price if regulators demand asset sales in excess of 20% of that number, or nearly $8 billion. [2]
See AT&T’s Plan to Save T-Mobile Deal May Not Be Enough.
Verizon continues to bring high profile smartphones to boost its portfolio of smartphones. Motorola’s Droid Bionic will come at a rather expensive $300 with a two-year contract, but supports high speed 4G LTE network and feature a dual-core 1GHz processor. BlackBerry Torch 9850 comes with a retail price of $200 when purchased with new two-year contract, and features the latest BlackBerry 7 operating system.
Notes:- Verizon BlackBerry Torch 9850 to Take on Motorola Droid Bionic 4G LTE Today, IBTimes, September 8th, 2011 [↩]
- AT&T Is Said Able to Cut T-Mobile Bid Price If Remedies Grow, Bloomberg, September 8th, 2011 [↩]
