Image via CrunchBase
It seems that many of the market watchers were surprised with yesterday's announcement that the US Justice department filed suit to block the planned merger of t-Mobile and AT&T. Honestly, I was not surprised that the merger is going to court.
With the US down to four national mobile carriers (Verizon, AT&T, Sprint and T-Mobile), competition is at risk. Outside the major metro areas, not all four carriers are ubiquitous, meaning that choice often falls between two or three carriers. It's easy to envision a situation with Sprint falling to a distant third-place and a duopoly of AT&T and Verizon resulting.
For those fuming over "big brother" sticking it's nose into private businesses - the huricane this last weekend has reminded us that our mobile telephone infrastructure is a critical resource for commerce and emergency communications. Letting something so important as mobile communications fall into the hands of a duopoly would put far too much control in the hands of a small number of executives with unclear motives.
Also, consider the number of every-day businesses that depend on mobile communications (both voice and data) to operate their businesses. From cab drivers to UPS, many need mobility to effectively operate their businesses. If coverage, congestion and pricing get fouled up as the result of a non-competitive duopoly, what happens to them?
So, what happens next to T-Mobile? Most likely they will continue to play the role of smaller, but more innovative carrier. With their international flair and product ideas often coming from Europe, expect them to play an important role in pre-paid and and cost effective data services. AT&T isn't known for their innovation - with the exception of signing a deal with Apple for exclusivity on the iPhone.
In my mind, four national carriers is good for the country and good for business.