The Wall Street Journal is reporting that AT&T ran into a major roadblock from the government over the proposed acquisition of T-Mobile USA. Both companies are calling it quits and going back to the drawing board, as it were.

AT&T said the following in an official statement:

“The actions by the Federal Communications Commission and the Department of Justice to block this transaction do not change the realities of the U.S. wireless industry. It is one of the most fiercely competitive industries in the world, with a mounting need for more spectrum that has not diminished and must be addressed immediately. The AT&T and T-Mobile USA combination would have offered an interim solution to this spectrum shortage. In the absence of such steps, customers will be harmed and needed investment will be stifled.”

Going out of the country for a few months? Apple will begin selling unlocked, contract-free iPhone 4S handsets online here in the US. The 16GB model will go for $649, 32GB for $749, and 64GB for $849. It's not a bad price to pay, but if you're attracted to Verizon or Sprint you should avoid going this route and purchase the handset for that service instead.