Legal News

NY AG Joins Chorus Of Folks Looking Hard at AT&T/T-Mobile Deal

By Ashby Jones

Hey AT&T, you sure you want to go through with this? You sure this whole “purchasing T-Mobile” thing is worth it?

Why do we ask?

Because getting it through the regulators isn’t exactly going to be easy. You’re going to have to marshal a whole bunch of lawyers to send a whole lot of briefs off to a lot of people, trying to convince them that the deal is good for consumers.

The heat is rising. The latest: New York Attorney General Eric Schneiderman said on Tuesday that he would put AT&T’s plan to buy T-Mobile from Deutsche Telekom under a “thorough review” of the potential impact on wireless competition in the state. Click here for the Dow Jones story.

Schneiderman is the first attorney general to publicly announce a review of the $39 billion deal. Based on past telecom deals, other state attorney generals are likely to weigh in.

But wait, that’s not all. Of course, the deal is expected to face heavy scrutiny from the FCC and Christine Varney’s team at the Department of Justice.

“Cell phones are no longer a luxury for a few among us, but a basic necessity. The last thing New Yorkers need during these difficult economic times is to see cell phone prices rise,” Schneiderman said in a statement.

Said an AT&T spokeswoman to the LB: “We look forward to sharing information with the AG’s office and remain excited about the significant consumer and competition benefits that this transaction will provide, including improved customer service and expanded high-speed LTE wireless coverage to additional residents and areas across New York State and the rest of the U.S.”

Critics say a deal between AT&T, the nation’s second-largest wireless provider, and No. 4 player T-Mobile USA would consolidate the power of the top two carriers in the nation, and lead to higher prices. Verizon Wireless is the currently the nation’s largest carrier.

AT&T argues that the deal will benefit consumers through improved coverage and a wider expansion of next-generation mobile broadband service.

On Monday, Sprint Nextel Corp. (S) formally expressed its opposition to the deal, and said it would take its case to regulators and work with other “like-minded companies.” The CEOs of Clearwire Corp. (CLWR) and LightSquared have also voiced their concerns about the deal.

Full post as published by Law Blog - WSJ.com on March 29, 2011 (boomark / email).