Scott Cleland’s Top 10 Flaws in DOJ’s case against AT&T

Scott Cleland, research analyst and president of Precursor LLC, has posted 10 solid problems in the Department of Justice’s antitrust suit to block AT&T’s merger with T-Mobile. All of these present significant obstacles to DoJ successfully providing enough proof to support its claims that the merger will, in the words of the complaint, result in “higher prices, poorer quality services, fewer choices and fewer innovative products for the millions of American consumers who rely on mobile wireless services in their everyday lives.”

The 10-point summary follows below. Cleland expands on each in the complete post, which can be found here.

  1. The DOJ’s own facts don’t support its national relevant market definition.
  2. The DOJ arbitrarily gerrymandered its market definition to exclude real and relevant market competition in a large geographic segment of the nation.
  3. The DOJ’s arbitrary national market definition completely ignores ~10% of their supposed “national” market.
  4. Implying #4 T-Mobile is the only important “maverick” competitor, essentially ignores how #3 Sprint also has many “maverick” attributes and capabilities that would survive the merger.
  5. The DOJ is arbitrarily ignoring its own longstanding precedent of defining the wireless market locally without any justification for this fundamental change.
  6. The DOJ is also trying to move the goalpost on what is an acceptable level of market concentration.
  7. The FCC’s competitive facts do not support the DOJ’s market definition or conclusion.
  8. The DOJ ignores and dismisses obvious market efficiencies
  9. The DOJ’s charge the merger will substantially lessen competition in “product variety and innovation” completely ignores the plethora of facts from the handset, mobile OS and App markets to the contrary.
  10. Maybe most importantly, the DOJ complaint ignores the explosion of market facts that show how dynamic and fast-changing the mobile marketplace has become.