AT&T T-Mobile Deal Dropped After Fierce Government Backlash
By Associated Press / huffingtonpost.com
Dec 19, 2011

 AT&T Inc. is hanging up on its $39 billion bid to buy smaller wireless provider T-Mobile USA, nearly four months after the U.S. government raised concerns that the deal would raise prices, reduce innovation and give customers fewer choices.

The long-expected announcement left AT&T grumbling about a shortage of airwaves to meet growing demand, while scrappy competitor T-Mobile remains up for sale by German parent Deutsche Telekom.

The formal end of the deal was heralded by critics. No. 3 carrier Sprint Nextel Corp. had feared "an undeniable duopoly" between the proposed new entity and current leader Verizon Wireless. The two companies would have controlled over almost 80 percent of the cellphone market had the deal gone through.

"This result is a victory for the millions of Americans who use mobile wireless telecommunications services," Deputy U.S. Attorney General James Cole said. "A significant competitor remains in the marketplace and consumers will benefit from a quick resolution."

The Justice Department had sued on Aug. 31 to block the deal, and the Federal Communications Commission's chairman came out against it last month. That prompted the companies to withdraw their FCC application while they strategized their next move.

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AT&T T-Mobile Deal Dropped After Fierce Government Backlash