Sprint fired back Tuesday against AT&T's claims that Sprint's CEO has back peddled on past statements touting the competitiveness of the U.S. wireless market by opposing AT&T's proposed merger with T-Mobile USA.
The tit-for-tat between the two firms began Friday when Sprint CEO Dan Hesse argued that wireless innovation and competition would be stifled if AT&T, the nation's second biggest wireless carrier, is allowed to buy the fourth largest provider, T-Mobile. The deal must be approved by the Justice Department and the Federal Communications Commission.
In a blog post Monday, AT&T's Jim Cicconi responded that Hesse's statements were at odds with his past statements touting the vibrant competition in the wireless market and support for mergers and acquisitions. "It is self-serving for them to argue that the highly competitive wireless market they cited only months ago is now threatened by the very type of transaction they seemed prepared to defend previously," Cicconi wrote.
In a conference call with reporters late Tuesday afternoon, Sprint spokesman John Taylor argued that AT&T "has a vested interest in distorting" Hesse's record on competition and mergers. Taylor noted that Sprint believes today's wireless market is competitive. But he added that, "If AT&T is allowed to swallow T-Mobile and create with Verizon a duopoly ... the competitive nature of today's wireless market could be stifled and wireless innovation could be put at risk."
Taylor said that if AT&T merges with T-Mobile, the combined firm along with Verizon Wireless, which is currently the nation's top wireless provider, will control 80 percent of the wireless market nationwide. Taylor added that while Sprint does not oppose consolidation in the wireless industry, the firm does not favor the AT&T-T-Mobile deal because it would create "a duopoly and blatantly consolidates the market into the hands of two companies."
In a response to the response, an AT&T spokesman said, "Mr. Hesse's recognition in recent comments that the U.S. wireless marketplace is fiercely competitive speaks for itself. As we stated last week, this hyper competitive marketplace will not become less so because of our transaction with T-Mobile."
Meanwhile, Cellular South announced its opposition Tuesday to the AT&T/T-Mobile merger. The firm's CEO Hu Meena said "It's bad for consumers. It's bad for jobs. It's bad for competition."
Don't Miss Today's Top Stories
Chock full of usable information on today's issues."
Michael, Executive Director
Concise coverage of everything I wish I had hours to read about."
Chuck, Graduate Student
The day's action in one quick read."
Stacy, Director of Communications
Great way to keep up with Washington"
Ray, Professor of Economics