The chairman of the Senate’s antitrust subcommittee is asking the Justice Department to block AT&T’s planned acquisition of T-Mobile USA.
In his letter, Senator Herb Kohl (D-Wisc.) tells Attorney General Eric Holder and Chairman Julius Genachowski of the Federal Communications Commission, that the deal would seriously hinder competition in the cell phone industry and harm consumers and urges the agencies “to take all necessary actions” to stop it.
Describing T-Mobile as a competitor of AT&T’s that offers lower prices, Kohl said that a deal that “eliminates the low price competitor from this market, is in my view highly dangerous to competition and consumers. It will likely tend to substantially lessen competition, lead to consumers paying high prices with fewer choices, as well as lessen the innovation that has been the keystone of this industry in the last decade.”
Kohl says that the acquisition would reduce the number of national competitors in the industry from four to three and thus is suspect under the Clayton Antitrust Act.
Kohl’s letter comes just as House Democrats, including House Judiciary Committee Ranking Member John Conyers (D-Mich.) are also questioning the deal, the National Journal reports, though AT&T continues to defend the merger.
“We respect Senator Kohl. However, we feel his view is inconsistent with antitrust law, is shared by few others, and ignores the many positive benefits and numerous supporters of the transaction,” an AT&T spokesman said in a statement, adding that AT&T believes that the DOJ and FCC will approve the deal.
