AT&T Says Justice Suit Is Off Base

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AT&T has told a U.S. District Court that the Justice Department was off base in filing an antitrust suit against its proposed T-Mobile deal in that court, saying in a response filed Friday that Justice did not accurately portray the state of competition in the mobile marketplace or the pro-competitive aspects of the deal.

The telco also said Justice did not "come to grips" with the efficiencies the nerger will generate and its impact on keeping prices down.

Justice alleged the deal would raise prices, reduce competition, and that the wireless broadband deployment that was one of the big value-added pushed by AT&T could be achieved without buying a competitor.

AT&T told the court, as it has told the FCC and the press, that the deal will free up new spectrum capacity, boost service quality, and lower prices. What's more, says AT&T, it will bring more competition to an already "vibrantly competitive" market.

The company takes issue with a host of Justice allegations. They include the characterization of AT&T, T-Mobile, Verizon and Sprint as the "Big Four" players, saying it is misleading, pointing to the FCC's latest report on wireless competition that found "more than 90% of U.S. consumers have at least five wireless providers to choose," which brought it to another Justice allegation: that those smaller, regional competitors are "significantly different." It denied that allegation without comment as well as the noncontroversial portions of the some allegation preambles, for example: "Defendants admit that mobile wireless telecommunications services have become widely adopted and have enabled a wide variety of devices, applications, and services."

The bottom-line response to the Justice charge that the merger would violate antitrust laws and should be permanently enjoined was that the department was wrong, should not get what it wanted, and should have to cover AT&T's court costs in defending itself and "any and all other relief as the Court may deem just and proper."

The deal is still being vetted by the FCC, which has problems with it as well, according to chairman Julius Genachowski, and even Justice has said its door is open if AT&T wants to talk about resolving its issues, which are substantial. AT&T plans to take them up on the offer.

But in the interim, AT&T is seeking expedited hearing and says it will fight vigorously in court -- Sprint has also filed suit against the deal.

"We have been and remain interested in a solution that addresses the DOJ's issues with the T-Mobile merger," said AT&T in a statement. "When these discussions occur they will be confidential and as such we won't be commenting publicly. We remain confident that we'll reach a successful conclusion and look forward to delivering the merger benefits of additional wireless network capacity to improve service, expanded LTE deployment to 55 million more Americans, $8 billion in additional investment, and a commitment to bring 5,000 wireless call center jobs back to the United States. "

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