Microsoft this week threw its support behind AT&T's proposed $39 billion purchase of T-Mobile, stating that the benefits of the two companies merging would outweigh the negatives. And the software giant isn't alone: Facebook, Research In Motion (RIM), Oracle, Yahoo!, and several other high-profile tech companies have also officially voiced their support.
"Many policy-related efforts will not be able to quickly address near-term capacity needs," a letter from Microsoft and other companies to the US Department of Justice (DOJ) and Federal Communications Commission (FCC) reads. "The FCC must seriously weigh the benefits of this merger and approve it."
Not everyone is happy about the proposed purchase. Sprint, which is currently the number-three wireless carrier in the United States and the company that would be most left out in the cold should it go through, has been very vocal in its opposition. And some high-profile tech companies that would be impacted by the deal, such as Apple and Google, have thus far remained quiet.
At issue here is the makeup of the US wireless market and fears that a smaller number of big players would harm innovation and competition. Today, Verizon and AT&T are the two largest wireless carriers by far, followed by Sprint and T-Mobile. But if AT&T were to purchase T-Mobile, it would become the largest carrier in the United States, and customers would have only three major services from which to choose.
Supporters of the deal say that critics conveniently forget to mention that there are dozens of smaller wireless carriers in the United States, however, most of which compete specifically on price. These smaller players will ensure that consumers always have low-cost options and choice, they say.
Both the DOJ and FCC will need to approve the deal before it can proceed. But don't expect a decision anytime soon: The approval process can take up to a year.
