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Late on Friday, AT&T announced plans to buy competing wireless carrier Leap Wireless. AT&T is one of the two largest wireless carriers in the country, while Leap Wireless is the fifth largest wireless carrier. AT&T's Aio brand and Leap's Cricket brand compete in the prepaid wireless market.
AT&T's press release can be found here.
The following statement can be attributed to Harold Feld, Senior Vice President of Public Knowledge:
"AT&T already has more wireless capacity than it needs to serve its customers, and it should focus on using what it has rather than continuing to try to buy out competitors. The wireless marketplace does not need more mergers and more concentration. Rather, all carriers should compete to win customers through improving their network quality, price plans, customer service, and handset selection.
Leap Wireless is the fifth-largest wireless carrier in the United States. Through its subsidiary Cricket, it serves millions of pre-paid customers, making communications services available to low-income customers, people with poor credit, and people who just want to do without the hassle of a wireless contract. If AT&T is allowed to remove Leap from the market, the customers it serves, particularly minority and low-income communities, will be disproportionately affected, and might have nowhere else to go.
Since the federal government said "no" to AT&T's efforts to take over T-Mobile in 2011, AT&T has been slowly buying up smaller companies and wireless licenses all over the country. It currently has a sweetheart deal to swap wireless licenses with Verizon Wireless pending before federal regulators. Throughout Washington DC, it is arguing that it ought to have the right to buy up as many licenses as it can grab in any upcoming federal wireless auction.
And now it wants to buy out a major wireless network, rather than build a new line of business on with the wireless capacty it already has?
This is getting ridiculous. The Justice Department and the Federal Communications Commission need to say 'no' to this latest effort by AT&T to buy out its rivals and rebuild 'Ma Cell.'"