The former head of the Department of Justice Antitrust Division reacted with some surprise about today’s announcement by his successors to object so strongly to the proposed merger of T-Mobile and AT&T.
“I am surprised, frankly, about the timing of this, in that this isn’t a merger that was about to close anytime soon,” said Don Baker, former head of the DOJ’s Antitrust Division. “Why they are filing it now is an interesting question.”
Baker suspects the Department may have been concerned about the long-term longevity of Sprint, dwarfed by its larger remaining competitors AT&T and Verizon Wireless.
“While this is nominally a four to three merger [removing T-Mobile from the market], the situation at Sprint seems seriously uncertain so it might well be regarded as a four to two merger,” Baker told CNBC.
Baker also believes Justice officials were unconvinced by AT&T’s arguments that the company would still face heavy competition from remaining regional wireless carriers.
“Roaming charges are a big deal for consumers,” Baker noted, suggesting few regional players could offer the kind of nationwide coverage larger players have.
But Baker, who served at the Department during the Carter Administration, said he wasn’t surprised with the eventual decision. In fact, he says he is pleased.
“It seems to be a pretty strong antitrust case for the government,” Baker said.
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CNBC interviews former DOJ Antitrust Chief Don Baker about today’s developments with the AT&T and T-Mobile merger. (6 minutes)