DOJ files to block AT&T, T-Mobile merger [The Hill]
The suit was filed based on anti-trust concerns the DOJ has over the merger of the two large mobile carriers. The DOJ is worried that the merger could result in much higher prices, fewer options, and lower quality services for customers.
The acquisition of T-Mobile would make AT&T the largest mobile provider in the U.S. and would result in 80 percent of the mobile market being controlled by the two largest providers - AT&T and Verizon. T-Mobile, on the other hand, has been a "aggressive competitor" in the eyes of the DOJ and has created the exact competition the DOJ is looking for by offering low-cost cellular plans. Their low-cost offering were clearly a major factor in the filing of the suit. The DOJ clearly doesn't like the idea of AT&T gobbling up smaller mobile competitors who compete by offering lower prices.
The case will now be heard by a federal court, where AT&T will challenge the DOJ's claims. The DOJ actually has the burden of proving that AT&T's purchase of T-Mobile would, in fact, have the affect of anti-competition in the mobile market.
The merger is also currently being reviewed by the FCC, and while FCC Chairman Julius Genachowski didn't commit to any affirmative action against the merger, he did echo some of the sentiments of the DOJ in a recent statement.