AT&T responds to Justice Department lawsuit


AT&T filed a response to the Justice Department's lawsuit to block the merger with

T-Mobile USA today, claiming the agency fails to understand the benefits of the deal

and isn't painting an accurate picture of the competitive environment.

The Dallas telecommunications giant largely brought up the same arguments it first

made to regulators: that the deal would allow AT&T to gain access to more spectrum,

let the company provide wireless broadband access to more people, and that it would

provide more competition in an already competitive industry. The filing also contains

specific responses denying multiple claims made in the Justice Department lawsuit.

"The Department of Justice's complaint fails to come to grips with the significant

efficiencies this transaction will generate," AT&T said in its filing. "(The) complaint

similarly fails to depict accurately the state of competition in mobile telecommunications

today, the dynamic nature of the wireless industry, or the pro-competitive and

pro-consumer impact of this transaction."

AT&T also took exception to the use of the term, the "Big Four," since there it

argues there are usually more than four competitors in each market. The term,

however, is often used in the industry to refer to the four nationwide carriers.

Consumer advocate groups and smaller companies led by Sprint Nextel have

used this argument in their push to stop the deal.

AT&T also argued that blocking the deal will do little to help T-Mobile, which

continues to lose customers and doesn't have the necessary spectrum to move

to a 4G network. It said that competition would actually be hurt if T-Mobile were

left alone because parent Deutsche Telekom has said it wouldn't invest in the business.

The company added that T-Mobile's "disruptive pricing" plans aren't affecting AT&T now.

"Blocking this transaction will not help T-Mobile or its customers," AT&T said in its filing.

AT&T has long sought to position the merger review to look at competition on a

market-by-market basis, where it claims multiple competitors exists. But the Justice

Department has opted to look at competition in a national level, with one out of

the four national players getting swallowed up by another.

AT&T, however, also expressed its willingness to work with the agency.

"At the same time, we have been and remain interested in a solution that addresses

the DOJ's issues with the T-Mobile merger," the company said in an e-mailed

statement alongside the filing.

The deal was put in serious jeopardy after the DOJ surprisingly filed its suit last week.

While not dead, most analysts believe there's a significantly lower chance that AT&T

will be able to push the deal through. The telecom giant has been left scrambling

to find a compromise, including the promise to bring back 5,000 outsourced call

center jobs and sell off significant chunks of T-Mobile as concessions.

AT&T and the Justice Department are scheduled to present their case to Judge Ellen Huvelle

during a hearing that starts on September 21

AT&T also said in the statement that it remains confident that it would close the deal.

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