News Analysis: Regional carrier Cellular South has filed an antitrust lawsuit seeking to stop the AT&T, T-Mobile merger as seven state attorneys general join the Department of Justice case.
Cellular
South, the largest privately held wireless carrier in the United States, has
become the latest telecommunications company
to file an antitrust suit in the U.S. District Court for the District of
Columbia seeking to stop the merger of AT&T and T-Mobile.
Cellular South is based in
Mississippi, Alabama, Tennessee and the panhandle of Florida. The carrier
provides CDMA coverage on its own network, and GSM coverage in the Huntsville,
Ala., home of a major NASA facility.
In
addition, the state attorneys general from New York, Washington, California,
Illinois, Massachusetts, Ohio and Pennsylvania joined the Department of Justice
lawsuit on Sept. 16. "Our review of the proposed merger between AT&T
and T-Mobile has led me to conclude that it would hinder competition and reduce
consumer choice," California Attorney General Kamala D. Harris said in a
statement announcing that her state had joined the DOJ suit.
"Enforcement
of antitrust law is the responsibility of the [state] Attorney General and is
vital to protecting our state's economic strength and tradition of innovation
for the betterment of all Californians," Harris said.
New
York's attorney general, Eric Schneiderman, said in a statement that the merger
would
stifle competition and eliminate low-cost options for wireless service. The
attorneys general for 11 other states have publicly supported the merger.
The
Cellular South suit, filed on Sept. 19, is
focused on the potential for harm, and perhaps extinction of regional
carriers, if the merger is allowed to go forward. Among other points, the
complaint says that regional carriers would be unable to get the latest
wireless devices in a timely fashion and at a reasonable cost because of the
market dominance of the two largest carriers, AT&T and Verizon Wireless.
The
complaint also says that Cellular South and other regional carriers would be
forced to pay higher roaming prices, assuming that they could get roaming
agreements at all. Furthermore, consumers would be forced to pay higher prices and
have less innovation, fewer choices and reduced competition, the complaint
said.
A
spokesman for Cellular South told
eWEEK
that their antitrust lawsuit is intended to raise the court's awareness of the
impact on regional carriers. Cellular South has almost 900,000 customers and
has CDMA roaming agreements with both Verizon Wireless and Sprint. Cellular
South is in the process of starting a Long Term Evolution (LTE) build-out
primarily in its rural markets, something that AT&T is promising but is saying
can't be done without the merger with T-Mobile, which serves primarily urban
areas.
Cellular
South's complaint also notes that the Federal Communications Commission has
failed to call the wireless market in the United States competitive during its
last review and that the company believes that the market has actually become
less competitive.
Email
Print
Wayne Rash is a Senior Analyst for eWEEK Labs and runs the magazine's Washington Bureau. Prior to joining eWEEK as a Senior Writer on wireless technology, he was a Senior Contributing Editor and previously a Senior Analyst in the InfoWorld Test Center. He was also a reviewer for Federal Computer Week and Information Security Magazine. Previously, he ran the reviews and events departments at CMP's InternetWeek.
