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Deutsche Telekom has no backup plan for T-Mobile USA
| 02 сентября 2011 |
A Deutsche Telekom board member revealed on Thursday that the company has not considered any alternative options for T-Mobile USA other than a sale to AT&T, reports Bloomberg.
Despite this, Niek Jan van Damme said the German incumbent has "everything under control" in relation to the proposed merger, insisting that its investment plans would not be affected in the event that the deal does not proceed."Of course extra funds would be good," he admitted, in the report.
Van Damme made his comments in the wake of a lawsuit filed on Wednesday by the U.S. Department of Justice (DoJ) that seeks to block the $39 billion acquisition of T-Mobile USA by AT&T on grounds that it would hurt competition in the country's mobile market.
"The combination of AT&T and T-Mobile would result in tens of millions of consumers all across the United States facing higher prices, fewer choices and lower quality products for mobile wireless services," warned deputy attorney general James Cole.
The DoJ said T-Mobile's history of aggressive pricing has been a disruptive force in the U.S. mobile market and an important source of competition. Therefore removing this disruptive force would have negative consequences for consumers.
In addition, the government concluded that "AT&T had not demonstrated that the proposed transaction promised any efficiencies that would be sufficient to outweigh the transaction's substantial adverse impact on competition and consumers."
AT&T said it was "surprised and disappointed" by the DoJ's announcement, claiming that it had no reason to suspect it was preparing a legal challenge.
"We plan to ask for an expedited hearing so the enormous benefits of this merger can be fully reviewed," said AT&T general counsel Wayne Watts, in a statement on Wednesday.
Since announcing the deal to acquire its rival in March, AT&T has touted the potential benefits to the U.S. mobile sector and the jobs market. The operator has also maintained that merging with T-Mobile would enable it to accelerate the rollout of its LTE network.
Ovum chief analyst Jan Dawson said the uncertainty created by the DoJ's lawsuit means AT&T has some difficult decisions to consider.
"[AT&T] will have to decide whether to press ahead with its own LTE rollout on the assumption that T-Mobile's network assets and spectrum will eventually be a part of it, or whether to pursue another strategy," he said.
"One option AT&T should immediately pursue is a network-sharing arrangement with T-Mobile along the lines of similar deals we've seen in Europe and elsewhere," Dawson suggested, noting that such a deal would arguably have been a better strategy at the outset, given the intense regulatory scrutiny a $39 billion acquisition attracts.
Dawson said the lawsuit also leaves T-Mobile USA in a difficult position, since the operator has struggled to compete after smaller players like MetroPCS and Leap Wireless began targeting the low-cost end of the mobile market.
"For both T-Mobile USA and its owner Deutsche Telekom, the AT&T merger was a great way out of this difficult situation," he said. "Now, Deutsche Telekom faces the prospect of hanging onto its unloved U.S. asset for a while longer with only the breakup fee for comfort, while T-Mobile USA ends up potentially going back to the drawing board for a new strategy."
Furthermore, long-time opponent of the merger Sprint Nextel has published the findings of research it commissioned to assess the impact the AT&T/T-Mobile merger would have on the U.S. jobs market.
Unsurprisingly the study's conclusions run contrary to the assertion by AT&T – based on earlier analysis of the deal's potential effect on employment provided by the U.S. Employment Policies Institute (EPI) – that the acquisition would create jobs.
According to David Neumark, an economics professor at the University of California who produced the Sprint-sponsored report, AT&T's claims are completely unfounded, and that the opposite conclusion is more consistent with the logic of mergers.
"The past record of employment changes following AT&T acquisitions of other mobile carriers indicates that these acquisitions led to reductions in employment among the workforces of AT&T and the acquired company," he said, in his report.
"I see no empirical basis for the claim that the direct effects of this merger will be to create jobs," Neumark added. "In fact, the merger will almost certainly directly result in the loss of thousands of jobs."
In the meantime, AT&T's Watts said the operator intends to "vigorously contest" the DoJ's lawsuit.
"We remain confident the this merger is in the best interest of consumers and our country, and the facts will prevail in court," he said.
Источник: Total Telecom
Адрес: 105082, Россия, г. Москва, 2-й Ирининский пер, д. 3
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