Many consumers and media reform groups reacted positively to the news of the Justice Department stepping in to try to block AT&T’s proposed $39 billion merger with T-Mobile, but an association representing independent app developers and entrepreneurs in D.C. issued a statement Wednesday blasting the Obama administration for its decision, calling it a “profoundly misguided decision.”
At issue is the wireless spectrum crunch, which many companies and venture capitalists in Silicon Valley had hoped would be addressed by this merger.
“The massive growth in the mobile internet marketplace may find its hub of innovation uprooting from our shores if we can’t provide the necessary infrastructure improvements to support its continued development,” said Morgan Reed, executive director of the Association For Competitive Technology, in a press statement. “Already the U.S. faces a drastically high wireless saturation with usage approaching full capacity far sooner than our international competitors.”
While ACT represents independent app developers and small businesses, it is funded by biggies like eBay, Intel, Oracle, Microsoft and Verisign.
Reed added:
“While the rest of the world is making the transition to new technologies like LTE to manage rising demand, the Justice Department has chosen to block growth, propping up companies that fail to adopt improved standards.
This is a profoundly misguided decision that means that the multibillion dollar investment AT&T was prepared to make in improving T-Mobile’s network will never occur.
This is an unfortunate turn of events for app developers who will soon face lagging wireless networks and disappointed customers.”
But Harold Feld, an attorney for the digital public interest group Public Knowledge, called Wednesday’s development “undoubtedly the best Labor Day present the Department of Justice ever gave America.”
Public Knowledge has long opposed the merger, saying that it’s anticompetitive. The group has also argued that neither AT&T or T-Mobile need the proposed merger to improve wireless service to consumers.
