On Sunday AT&T announced that it had reached an
agreement to buy T-Mobile USA from Deutsche Telekom for $39 billion.
If the deal goes through, then only three
major players would remain in the U.S. cellular industry:
AT&T, Verizon and Sprint Nextel.
Critics have attacked the proposed deal,
saying that it will lead to higher prices.
Their reasoning is that even if AT&T honors existing T-Mobile
contracts, those T-Mobile customers may have to pay increased rates when their
contracts expire.
However, a recent
report created by the federal Government Accountability Office cited a 50
percent reduction in cellular subscription costs from 1999 to 2009, a time
period during which the industry was consolidated.
The major loser in this game of corporate
monopoly is probably going to be Sprint Nextel,.
Verizon and the potentially new AT&T have
230.3 million customers in the U.S.,
while Sprint has just under 50 million.
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