AAPL Stock: 118.67 ( + 0.86 )

Printed from

Sprint objects to AT&T/T-Mobile deal as 'Ma Bell duopoly'

updated 04:15 pm EDT, Mon March 28, 2011

Sprint formally opposes ATT T-Mobile merger

Sprint on Monday put out a formal statement objecting to AT&T's buyout of T-Mobile. The carrier said it planned to resist the deal where possible and reiterated its earlier view that the move would put too much power in one company and give AT&T three times the revenue. Government Affairs Senior VP Vonya McCann stopped short of implying legal action but said an approval would turn back a quarter century and return to the days of AT&T's monopoly of the US phone business pre-1984, with Verizon being the only other choice.

"Sprint urges the United States government to block this anti-competitive acquisition," she said. "This transaction will harm consumers and harm competition at a time when this country can least afford it. As the first national carrier to roll out 4G services and handsets and the carrier that brought simple unlimited pricing to the marketplace, Sprint stands ready to compete in a truly dynamic marketplace. So on behalf of our customers, our industry and our country, Sprint will fight this attempt by AT&T to undo the progress of the past 25 years and create a new Ma Bell duopoly."

The remarks echo what CEO Dan Hesse said during the spring CTIA keynote last week, where he openly criticized and joked about AT&T's behavior with the latter's wireless chief Ralph de la Vega sitting by his side. Among the criticisms were that it would stifle innovation and give AT&T 79 percent of subscription cellphone audience in the US, leaving Verizon and Sprint to get the majority of the rest as well as turn to prepaid users.

AT&T in a presentation discussing its plans tried to put a patriotic spin on the merger, saying it would solve spectrum problems by giving more Americans access to LTE and improving overall capacity.

Clues have emerged from the FCC that it could at least impose stiff conditions or even block the deal. The Department of Justice must also look at the deal and may have its own concerns.

by MacNN Staff



  1. prl99

    Joined: Dec 1969


    progress? what progress?

    MaBell was broken up with the expectation that there would be competition both in price and product. None of this has happened because of changes by AT&T, Verizon, Sprint or the other minor companies. Prices haven't gone down and the only development comes from the phone manufacturers driving requirements by the cellular companies. Recombining them won't put us back into the old MaBell days because the customer finally has some clout in forcing some changes that we never previously had.

  1. Le Flaneur

    Joined: Dec 1969


    it's scandalous

    The mobile market is like the telephone market before the Ma Bell breakup. You can only use certain handsets with certain carriers, handsets are locked to carriers, there are anti-competitive exclusivity agreements, carriers are not obliged to lower their monthly rates at the expiration of contracts, etc. Do you know where the mobile markets are competitive? In Europe!

  1. swissmann

    Joined: Dec 1969


    More ranting

    Mobile phone prices are way too much. Right now for $60 a month I have unlimited voice to anyone in US, unlimited texting, and unlimited internet with an iPhone. This is through T-Mobile. I price out Sprint, Verizon, and AT&T and they are all about twice as much. Really can't they provide unlimited everything and an iPhone for about $50 a month. I bet they could and would still turn a hefty profit. I think they should. Here's to hoping that my current plan get's grandfathered into AT&T and Verizon cuts prices to be competitive.

  1. Inkling

    Joined: Dec 1969


    Competition & regulation

    In the initial, early-1990s cellular plans, there were to be only two cellular providers per community: one linked to an existing wireline telephone company and one not linked. We certainly have more than that in most major cities, but the results are less than impressive.

    I tend blame the culture of cell-phone companies for consumer frustration, although T-Mobile was a partial exception. These companies have inherited the attitudes of most highly regulated industries. There, the most important objective isn't to serve the public, it's to please the regulators.

    I saw that attitude back in about 1992, when a bad experience gave me a reason to unlist my phone number. I was surprised to discover that costs $5/month. That's too much, I thought, to simply check a box in a computer database. It made no sense.

    I mentioned it to a friend who'd retired from the regulatory branch of a phone company. Her excuse made no sense either. Times when the phone company needs to provide the police with an unlisted number are so rare, that there's no need to hire a single added staff to do that. The cost of running an unlisted number system is essentially zero. Yet she claimed it was considerable.

    Thinking about that and my own experience at how a cellular company I'd worked for dealt with state regulators gave me a better answer. Regulators are often clueless. I saw one of that cell company staff fiddle around for an entire day, inflating expenses to justify certain pre-determined charges to the state. The regulators probably fell for that ploy. But regulators also have to please their bosses--politicians. And politicians like to be able to claim that they're looking out for poor widows by keeping the cost of basic telephone service low. The result was a strange pricing scheme.

    How did phone companies at that time subsidize basic phone service? In part by charging outrageous fees for every little add-on service. In the saner world of the 1950s, an unlisted number was seen as a luxury for celebrities and the wealthy, so why not make them pay large fees? In our day it's often a necessity for ordinary people to escape stalkers and dangerous ex-hubbies. But the regulators, with their eyes focused only on politicians and ancient policies, didn't see that new reality. And the telephone companies, with their eyes only on the regulators didn't see it either. The result was a public ill-served.

    Today, cell companies have inherited that corporate culture and play much the same game. Every little additional fee they can extract from users is an excuse for a charge, the more the better. They may not be concerned about keeping that widow's phone cheap, but they are eager to keep their advertised monthly rates low and make up the difference with tacked on charges of all sorts. That's why, when I converted to cellular service, I found a friend's warning was right. Counting all the fees and taxes, he told me, look for your real bill to be about $20 more than what was advertised.

    I'm not sure how we can fix this unhealthy corporate culture. Competition doesn't affect it much, because all those involved share the same mindset. It probably does mean trouble as T-Mobile, at least a bit distant from that culture, is acquired by AT&T, where that 'please the regulator' culture in deeply embedded.

  1. Steve Wilkinson

    Joined: Dec 1969


    One way or the other...

    We need to go one way or the other... either a) shut down these telcos and make them a government run utility (may as well since the tax-payers have already paid them so many hundreds of billions on something they haven't delivered on... we should just be able to take them on breach of contract) or b) force some competition

    This AT&Tmo deal does neither! It only spells BAD for the the consumer.

  1. comanche8

    Joined: Dec 1969


    prl99 & chas_m You are both a little off

    Maybe you are too young to know the history.

    When MaBell was broken up their was competition and there was better pricing from CLCs Competitive local carriers. When the Bell was broken up we are talking land lines - which here will serve for the model for pricing of what you get.

    I signed on with Brooks Fiber for my phone and high speed internet. With Brooks i had 2 business lines (they didn't offer residential & Brooks said they are exactly the same anyway but the business line included a yellowpage listing) AND an ISDN line. Brooks connected a T1 to the building I was in. I had spoken to and gotten 22 other people to add lines in my building & Brooks charged No installation fee for any of us.

    So with two business lines and an ISDN line Brooks charged me $48 dollars a month. At the time SBC/AT&T charged $58.00 per month for one business line & $125.00 for an ISDN. Also my POTS lines included all the features that SBC charged extra for - call waiting, conference calling, caller ID, etc. Brooks Rep told me that those services had been built into the switches for years and it was more cost effective to include them than to switch them on or off as needed.

    Verizon bought out Brooks (made an offer they couldn't refuse). - I tried to get pricing from Verizon - Verizon's ISDN with the 2 POTS lines went up to $168 per month.
    They had pricing for just a landline, Verizon had packages that were crazy (above SBC/AT&T).
    I was still in touch with my Brooks rep and she told me that - basically Verizon and SBC/AT&T had agreed to divvy up the regions. So Where Verizon was in my area they would set the pricing higher than AT&T so people would naturally sign on with AT&T. Verizon did this by selling the lines only in packages that they could jack-up pricing on. See if they priced the products in the same way as AT&T you would be able to compare the pricing on an item by item basis...

    So the pricing did go down until the telcos started merging back so they could monopolize and set whatever price they liked.

    prl99: when there is a monopoly the customer doesn't have any clout.
    chas_m: No way is mobile phone pricing the same as in the 80's.

    You know the equipment upgrades the telcos do - do not warrant increases in charges - they write off those purchases - off the top of their revenue and then get tax breaks because of them!

    And you know how many electronics with electronics advances over time cost less and less.

    h*** my father worked at AT&T from the 50s until he retired. He was Senior Engineer at the largest Bell. When the Bells started moving from dial phones to tone phones the Bells started charging an additional fee to have a tone phone instead of a dial. My father refused to pay extra for the tone phones because he knew the the new switches could do both and actually cost less, were more efficient, and AT&T was writing them off anyway.

    Don't ever think the Telcos or any business that follows the corporate mission of ever increasing profit to be doing anything for the customers benefit.
    That is PR (or PSY/OPS)... it's a means to an end - increasing profit.


Login Here

Not a member of the MacNN forums? Register now for free.


Network Headlines

Follow us on Facebook


Most Popular


Recent Reviews

Ultimate Ears Megaboom Bluetooth Speaker

Ultimate Ears (now owned by Logitech) has found great success in the marketplace with its "Boom" series of Bluetooth speakers, a mod ...

Kinivo URBN Premium Bluetooth Headphones

We love music, and we're willing to bet that you do, too. If you're like us, you probably spend a good portion of your time wearing ...

Jamstik+ MIDI Controller

For a long time the MIDI world has been dominated by keyboard-inspired controllers. Times are changing however, and we are slowly star ...


Most Commented