Senator Kohl, Others Come Out Against AT&T Merger – Not Unexpected Part of the Process

by Mike Wendy on July 20, 2011

Today, Senator Herb Kohl, Chairman of the Senate’s Subcommittee on Antitrust, came out against the merger of AT&T and T-Mobile, with the Senator stating in a letter to regulators:

“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.”

In a coincidental move (most probably orchestrated by the anti-AT&T lobby and aligned “public interest” groups), others on the House side came out with their own statement today, calling for heightened scrutiny of the merger.

None doubt that Congress is right to take a close look at the merger.  Senator Kohl’s letter, as well as that of the House members, is a normal part of this process.   Ultimately, however, the Department of Justice and the Federal Communications Commission must make the call whether consumers and the public interest are served.

Though one might conclude that one fewer competitor in a given market could harm choice and lift prices, effective competition is more than just market share. Most data show that the wireless market remains exceptionally vibrant for consumers.  Post merger, three “national competitors” and numerous “local competitors” will remain in most U.S. markets, essentially leaving in place the present checks that constrain the market power and anti-competitive behavior of all wireless companies.

Though Senator Kohl and the others have their doubts, the marketplace will likely prove them wrong – it will continue to thrive, giving consumers great competitive services, devices and innovation at tremendous value.

The review process is long and fraught with many tricky obstacles that could doom the pro-consumer union of the two companies.  One hopes, however, that it moves along expeditiously at the DoJ and FCC, as free as possible from the corrupting influence of special interests that either want to sink the deal out of animus for all things corporate, or want special handouts for their corporate sponsors who choose to blame the marketplace for their own failures.  American consumers deserve no less.

 

 

 

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