AT&T’s acquisition of T-Mobile creates near duopoly: NY AG

   on March 29 2011 9:29 PM
AT&T Inc. CEO Randall Stephenson announces his company's proposal to buy T-Mobile from Deutsche Telekom in New York
AT&T Inc. CEO Randall Stephenson announces his company's proposal to buy T-Mobile from Deutsche Telekom in New York Reuters

AT&T’s proposed acquisition of T-Mobile would open the “door to a near duopoly shared by the merged firm and Verizon,” stated the New York Attorney General’s office. The two companies would have well over 200 million subscribers and dominate 80 percent of the market.

This high level of concentration potentially makes the wireless network industry uncompetitive.  Moreover, T-Mobile is the cheapest choice available for many of its 34 million US subscribers.  If it’s acquired by AT&T, cost will probably go up for a good number of those customers.

Due to these concerns, the New York Attorney General will review and analyze the merger for any potential impacts on consumers and businesses across New York State.

“Cell phones are no longer a luxury for a few among us, but a basic necessity. The last thing New Yorkers need during these difficult economic times is to see cell phone prices rise, said Attorney General Eric Schneiderman.

AT&T and T-Mobile, in their defense, said the merger would create economies of scale and expand coverage.  Schneiderman said he’d weigh these potential benefits against anti-competitive risks.

 

 

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