Reuters is reporting that AT&T will soon present a new, two-track plan to United States antitrust regulators in an effort to salvage its proposed purchase of T-Mobile. The deal, estimated at $39 billion, hit a major roadblock on Wednesday when the Justice Department announced it would be filing suit to stop the deal, as it would lead to just three wireless companies controlling 90 percent of the U.S. market.
AT&T hopes there are enough concessions in the new plan to to allow for a settlement before the lawsuit goes to trial.
According to Reuters, details of the new plan are not available yet, but their sources indicate it is expected to include a promise to keep T-Mobile's pricing plans in place. Also, the sources claim AT&T may have to sell up to 25 percent of T-Mobile's business, including airwaves and customers, to keep some competition in the mix.
Selling off some of the business is not that cut and dry, however; Reuters points out that while there could be several buyers for regional assets, the only possible buyers for national assets are Verizon and Sprint. A purchase by either of those companies would likely lead to yet another round of antitrust scrutiny.
If AT&T is unable to stop the lawsuit, and the Justice Department succeeds in stopping the deal, big blue would have to pay T-Mobile parent Deutsche Telekom around $6 billion in cash and other assets as part of the original deal. According to the report, Deutsche Telekom has been trying to unload T-Mobile, and has no backup plan if the deal with AT&T collapses.
Via Reuters
Adrian covers daily news as well as the weekly Law & Apple column for MacLife.com. You can follow him on Twitter, if you want to.
StoneE4
September 07, 2011 at 4:04pm
Sorry... Catching up on old news here.
"If AT&T is unable to stop the lawsuit, and the Justice Department succeeds in stopping the deal, big blue would have to pay T-Mobile parent Deutsche Telekom around $6 billion in cash and other assets as part of the original deal."
Why would IBM have to pay Deutsche Telekom anything?
kylerwalker
September 02, 2011 at 3:03pm
atat thought they could buy tmobile out well they failed i think most of us knew that they would fail in the first place
brandonwalkermedia
September 02, 2011 at 2:31pm
Hmm im guessing the plan will have to in include less job creation to get past this administration! Vote out the administration that is killing jobs in 2012. I wish AT&T had fought this brain dead administration instead of conform to its job killing agenda!
viper1970
September 02, 2011 at 1:54pm
The Justice Department remembers well what happened the last time you tried to get a leg up on the competition. Now, Justice department, turn your attention to the cable and music industry.
brandonwalkermedia
September 02, 2011 at 2:37pm
NO the government needs to stay out of business! It did not create business, they (hard working people) created it. All the government does is mess things up. if prices are to high people stop buying then prices go down, thats how things should work. The only time government should step-in is when there is only 1 company (like ma-bell) but as long as there are 2 there will always be comp. + we have 3 Sprint/AT&T/Verizon and don't forget about smaller cheaper ones like MetroPCS/Cricket
SalHepatica
September 02, 2011 at 8:11pm
I detect someone who didn't manage to stay awake during American history class, where we learned that the so-called "competitive" "free" "market" doesn't exactly work that way in real life. See Standard Oil, the railroads, and so on. Because competition does tend to drive down prices, corporations want nothing to do with it. So they merge, they informally divvy up markets so they don't have to compete directly, and they do price-fixing (notice how unlimited data plans are quietly biting the dust among cell carriers?). Two companies in a market is not competition, it's duopoly. If T-Mobile becomes part of AT&T, it's only minutes until Verizon swallows up Sprint. If that happens, it's only a matter of time before MetroPCS and Cricket fade away because they can't compete in the most profitable segments of the cell phone market. Corporations' ability and willingness to abuse customers is a matter of history, the government is literally the only voice you and I have to moderate the greed and abuse, and it's a limited voice given corporations' ability to pay for politicians' campaigns.
brandonwalkermedia
September 02, 2011 at 8:58pm
i see someone slept trough business class. Business is what creates jobs that create a government!
Also if government is handling everything and going to make everyone = why should i make apps for others? i get no where because the government will just tax me for the work i have done.
