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Daily Newscasts

Justice Department Hangs Up on AT&T T-Mobile Merger

September 1, 2011

ALBUQUERQUE, N.M. - Consumer groups are hailing the decision by the Justice Department to block the merger of AT&T and T-Mobile on antitrust grounds.

The suit filed Wednesday aims to stop the $39 billion deal combining the second- and fourth-largest wireless carriers. The new entity would have leapfrogged over No. 1 Verizon Wireless, creating what critics called a virtual duopoly, with Sprint Nextel a distant third.

Parul Desai, policy counsel for Consumers Union, calls it a bold move.

"We're happy that the Department of Justice recognized that this would lead to less competition, less choice, ultimately higher prices for consumers. And I think this is a great day and a great win for consumers all across the country."

New Mexico had a lot at stake in the decision, says Andrea Quijada, executive director of the Media Literacy Project in Albuquerque.

"We have two T-Mobile call centers. We have 2,000 people employed by T-Mobile. Based on AT&T's industry estimate, we were standing to lose 20,000 jobs. We knew a substantial percentage of those would probably be coming from New Mexico."

Quijada's group has been working with grassroots organizations around the nation to highlight problems with the merger, and she feels it's paid off.

"We believe it has a lot to do with the national actions that New Mexico has been part of. The Department of Justice is listening to the people."

The Communications Workers of America supported the merger, as did Microsoft and the AFL-CIO.

AT&T said it would "vigorously contest" the matter in court. The company had said Tuesday it would bring some overseas call centers back to the United States to create 5,000 jobs to help counter criticism the merger is a job-killer.

Deb Courson Smith, Public News Service - NM