November 08, 2011, 2:23 PM — Maybe it was just gamesmanship, but if comments from U.S. Attorney General Eric Holder at a Senate hearing Tuesday are any indication, AT&T shouldn't be counting on a settlement of the antitrust lawsuit brought by the Justice Department.
During the hearing, Judiciary Committee antitrust panel Chairman Sen. Herb Kohl, D-Wisc., asked Holder if the Justice Department would be in the case "for the long haul."
Holder responded that "people in the antitrust division are committed to seeing this through."
"There is a trial team that is in place and they are ready and eager to go to court," he told the oversight hearing.
Again, this could be a negotiating strategy to force heavy concessions from AT&T in exchange for the federal government's approval of the telco giant's $39 billion acquisition of T-Mobile USA from Deutsche Telekom. (In September there were reports that AT&T was offering to sell spectrum and subscribers to smaller, regional wireless providers.)
But the case isn't supposed to go to trial until mid-February, so that leaves plenty of time for AT&T to reload its lobbying guns.
Arguing that the merger of two of the four major U.S. wireless carriers would hurt consumers through less competition and higher prices, the Justice Department filed the suit on Aug. 31 (the same day AT&T promised to un-offshore 5,000 call-center jobs if only antitrust regulators would approve the controversial deal).
No. 3 U.S. wireless carrier Sprint Nextel, which existence arguably is threatened by the proposed merger, has joined the federal lawsuit. Should the deal be approved, AT&T would become the No. 1 wireless carrier in the U.S., surpassing Verizon. Together, however, the two companies would have about 80% of the market.
AT&T argues that, rather than create a duopoly, the merger would benefit consumers by lowering prices, increasing innovation and accelerating the roll-out of high-speed wireless Internet access.
The Federal Communications Commission also is conducting a review of the proposed deal.