Sprint CEO Dan Hesse Says AT&T/T-Mobile Merger "Stifles Innovation" - Will Appeal

[dgstorm]

Sprint CEO Dan Hesse has issued further statements regarding the planned merger between AT&T and . His perspective is that the combined company would have "tremendous" power that ultimately would narrow market competition and "stifle innovation". He intends to file an appeal with Congress during the merger proceedings. He also pointed out that if the merger goes through then AT&T/T-Mobile and Verizon will hold 79% of the market, leaving Sprint with even less than ever before chances of competing.

Jim Cicconi, senior executive vice president at AT&T, responded to Hesse’s comments in an e-mailed, “We understand Sprint has concerns, and we’ll be happy to address any they present, whether at the Justice Department, the FCC or the Congress. We feel we have good and compelling answers. And we feel policymakers will readily understand that any company with whom AT&T competes may not be especially positive about anything which makes AT&T a better competitor in the wireless market.”

I can understand why AT&T wants to do this, but it definitely needs to be carefully reviewed, so we don't end up with another giant anti-competitive conglomerate lording over its customers. I remember during the eighties when "Bell" telephone was broken up into AT&T and other smaller "Bells". Eventually, this merger could end up squeezing Sprint out of the business, and that wouldn't be good for Verizon or consumers. What do you guys think?

Source: Android.net via Phandroid and Bloomberg

 

[jstafford1]

They can appeal all they want....ain't gonna stop it. AT&T knows how to grease the right wheels.

Sent from somewhere...

 

[sidsixseven]

How much of the market is a combined AT & T and T-Mobile as compared to Verizon and Sprint? If it's more than 50%, there is a good chance that the merger will be blocked.

Or at least, it SHOULD be blocked.

When you are talking about the reasons for having anti-trust laws, the critical factor to me are 'barriers to entry'. In other words, the barrier to entry for something like software is relatively low. A handful of dedicated software devs can come up with a whiz bang replacement for any product.

But with a Cell service carrier, we are talking MAJOR infrastructure. For a "start-up" that's a very significant barrier to entry. Which means that if the existing players squeeze each other out -- there is a very poor chance of new players entering the market.

And that's a bad thing because it means less competition. Less competition means less choice for you as a consumer. Fewer choices means less pressure on the providers to offer better services and better prices.

So, at least in my opinion, this might be a very bad thing.

 

[cucucachu0000]

if sprint wants to compete they should come out with lower prices or better service not begging the government to bring his competition down to there level. they cant compete cuz they suck and rather than inovate they get there government thugs to tear down what anybody better than them. what i want to see is a price war until either the new and improved at&t or verizon gets knocked out and once they start raising prices and lowering service another company steps up and then they get into a price war. i felt the same way as you guys, read atlas shrugged its a great book and it will open your eyes.

 

[jstafford1]

Sprint's pissy because they got shafted. They were trying to buy Tmobile, and AT&T swooped in a got em.

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[jstafford1]

Tell me why it would stiffle competition if AT&T merges and not Sprint?? No real difference except market share. This put Sprint solidly in third and falling. That all this is about.

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[yahwarrior]

GOOGLE will be the only phone company in the end. It's just a matter of time.

 

[thesandman00]

Tell me why it would stiffle competition if AT&T merges and not Sprint?? No real difference except market share. This put Sprint solidly in third and falling. That all this is about.

Sent from somewhere...

A Sprint/T-Mobile merger and an ATT/T-Mobile merger are two vastly different scenarios.

 

[jstafford1]

Tell me why it would stiffle competition if AT&T merges and not Sprint?? No real difference except market share. This put Sprint solidly in third and falling. That all this is about.

Sent from somewhere...

A Sprint/T-Mobile merger and an ATT/T-Mobile merger are two vastly different scenarios.

Not from a competition stand point. Really its all about market share. Sprint could compete if they wanted. People don't like them for their coverage and customer service the two complaints I hear most.) They have good phones, as we see VZW has the crap phones but better coverage and service. I'm just saying Sprint is tossing out the line about it being bad for competition because they are pissed Tmobile went with AT&T over them.

Sent from somewhere...

 

[thesandman00]

Tell me why it would stiffle competition if AT&T merges and not Sprint?? No real difference except market share. This put Sprint solidly in third and falling. That all this is about.

Sent from somewhere...

A Sprint/T-Mobile merger and an ATT/T-Mobile merger are two vastly different scenarios.

Not from a competition stand point. Really its all about market share. Sprint could compete if they wanted. People don't like them for their coverage and customer service the two complaints I hear most.) They have good phones, as we see VZW has the crap phones but better coverage and service. I'm just saying Sprint is tossing out the line about it being bad for competition because they are pissed Tmobile went with AT&T over them.

Sent from somewhere...

I'll give you most of that, yes. But Market Share is a huge component to competition in this case IMO. And it's one less competitor putting pressure on ATT to keep their prices low.

 

[jstafford1]

A Sprint/T-Mobile merger and an ATT/T-Mobile merger are two vastly different scenarios.

Not from a competition stand point. Really its all about market share. Sprint could compete if they wanted. People don't like them for their coverage and customer service the two complaints I hear most.) They have good phones, as we see VZW has the crap phones but better coverage and service. I'm just saying Sprint is tossing out the line about it being bad for competition because they are pissed Tmobile went with AT&T over them.

Sent from somewhere...

I'll give you most of that, yes. But Market Share is a huge component to competition in this case IMO. And it's one less competitor putting pressure on ATT to keep their prices low.

Now that is most definately true. Tmobile made everyone hold the line on prices. Just gotta see how this all pans out though. I still don't think it has any chance of being blocked.

Sent from somewhere...

 

[thesandman00]

Not from a competition stand point. Really its all about market share. Sprint could compete if they wanted. People don't like them for their coverage and customer service the two complaints I hear most.) They have good phones, as we see VZW has the crap phones but better coverage and service. I'm just saying Sprint is tossing out the line about it being bad for competition because they are pissed Tmobile went with AT&T over them.

Sent from somewhere...

I'll give you most of that, yes. But Market Share is a huge component to competition in this case IMO. And it's one less competitor putting pressure on ATT to keep their prices low.

Now that is most definately true. Tmobile made everyone hold the line on prices. Just gotta see how this all pans out though. I still don't think it has any chance of being blocked.

Sent from somewhere...

Honestly, I don't see this standing any chance either. I hope it gets blocked, but like you said, really probably not going to happen.

 

[MoeDaddy]

At&T and T-Mobile (AT&T&T) would be vastly different than Sprint and T-Mobile (Sprint&T).

AT&T&T would have near 50% market share and would have much greater power and pull with oem's and would make it the market share king by a nice margin. Where as Sprint&T would still be in 3rd place but would make up some ground and they would still be hungry and their lower prices would have a greater affect on the 2 bigger carriers keeping prices in check for cunsumers. If this goes thru AT&T&T and VZW would BE the market! They could set market prices and terms without much regard to sprint or other small local carriers, loosing T-Mobile as our 4th national carrier leaves Sprint as the last voice of reason in the war on prices and alone their voice is just too quiet to be heard. The iphone is a perfect example of what happens when companies have too much pull, sprint, T-Mobile, Metro-PCS, etc... losse out on the iphone customers because they are too small to matter. That would only get worse for them if AT&T&T goes thru.

Will it go thru, no idea, but with an election year coming and the political winds are not yet gusting so it'll be interesting to see what happens.

 

[kptphalkon]

Who said that Sprint needs to lower their prices to compete? They are the lowest priced cell provider! My girlfriend pays 70 bucks for unlimited mobile to mobile, texting and data. My bill would easily double that on Verizon.

This merger would be a terrible blow to competitiveness, but I could see it going through if sprint were to be bought out by verizon.

If anything the act of ATT buying T Mobile was a swift move to cover lost ground from Verizon taking future iPhone market share, and wanting to remain the superior provider in terms of total customers. It seems like an attempt to save face in the long term, and as of now I just cant see Sprint staying along without eventually dwindling down, losing money, and being bought out by whichever of the Big Evils are the smallest.

AT&T has a history of growing to big for itself, branching off to prevent or in the face of government recourse, and then merging back with those branch offs when the market changes or regulations change. If we all recall, sbc global was initially a diverge of ATT which later bought ATT and took the name for branding and familiarity.

Just some food for thought,

Intel and AMD
ATI (AMD) and Nvidia
Apple and Windows
iOS and Android
And probably,
AT&T and Verizon Wireless.

 

[kptphalkon]

*cough* no edit

And probably,
AT&T&T and Verizon WirelesS