Monday, September 12, 2011

Department of Justice Tells AT&T Do Not Pass Go, Do Not Monopolize the Phone Business

By Jessica Penland 
On Wednesday, August 31, the Department of Justice filed a federal lawsuit against AT&T, in an attempt to stop the phone company from merging with T-Mobile.

The Department of Justice wants to block the $39 billion deal because they believe the lack of competition will cause problems for consumers according to Deputy Attorney General James Cole.

In the Associated Press article, “Government sues to block AT&T, T-Mobile merger,” by Joelle Tessler and Pete Yost, Cole said, “tens of millions of consumers all across the United States facing higher prices, fewer choices and lower quality products for mobile wireless services.”

Competition between businesses not only allows for prices to remain lower, but forces companies to be more innovative.  If one company creates a new product unlike anything else on the market, the other companies feel the need to create something better.

T-Mobile has been very innovative, not only when it comes to product creation, but services or features to go along with the product.  They were the first to create the handset using the Android Operating System and national Wi-Fi “hotspot” access, among other products, services or features.

According to documents from T-Mobile, their strategy was to use innovation and unconventional thinking as a way to beat the other phone companies who are bigger than them.

Since the filing of the lawsuit, AT&T has claimed that they are disappointed with the actions of the Department of Justice because they have been co-operative.  They have also said they would bring back 5,000 outsourced jobs to the United States if they merge with T-Mobile.

What do you guys think?  Should the merger continue without a hitch, or should AT&T be stopped?

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