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A Few Thoughts on the Sprint/T-Mobile Merger Rumors

Rumors or announcements of mergers often drop on Friday afternoons, especially around holidays. This time it’s the Wall Street Journal reporting that Sprint is considering a bid for T-Mobile.

I have some thoughts on this! Basically, the national wireless market is already too concentrated. We need more, not less competition.

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In Less Than 1 Year Verizon Data Goes from $30/Unlimited to $50/1GB

Today, Verizon Wireless announced its new pricing plans for mobile phones and data.  If you mostly use your phone for data, this is bad news.

Verizon's New Pricing PlanVerizon’s New Pricing Plan

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The Sprint Standing Skirmish: AT&T Loses Some Ground, DoJ Gets Road Map Forward.

Any tactician knows that battles can be won or lost by defining the battlefield. Skirmishes like the fight over whether Sprint and C. Spire (formerly Cell South) can go ahead with their private lawsuits against AT&T’s acquisition of T-Mobile help define the terrain for the bigger fights to come (order here). By ruling on what constitutes a recognizable injury under the antitrust rules and making preliminary determinations about the nature of the market, the Order sets the boundaries of what arguments DoJ can make and what it will need to do to prove its case. Where AT&T manages to have certain market definitions locked in and certain potential injuries excluded as not cognizable under antitrust in these early rounds, it gains an advantage.

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Why DoJ’s Win Against H&R Block Is Bad News For AT&T/T-Mo.

The Department of Justice Antitrust Division (DoJ) just won its lawsuit to block H&R Block from acquiring its smaller, “maverick” competitor Tax Act. Even with the actual Order sealed for a month to let parties scrub out the trade secrets, a few important things stand out for why this is good news for DoJ in its lawsuit to block AT&T taking over T-Mo. In sports terms, this is like DoJ having a super strong exhibition season going into the regular season of play. While you still need to play the games to see who wins, anyone facing them ought to be worried.

Here are my major takeaways from what we know so far:

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A Job-and-Pony Sideshow on the ATT/T-Mobile Merger

Just before the Justice Department announced that it was suing to block AT&T’s acquisition of T-Mobile, AT&T promised regulators that it would bring 5,000 call center jobs back into the country, if only the merger were approved. Amazon, facing the prospect of paying sales tax in California, promised it would bring 7,000 jobs if only they didn’t have to pay those taxes. After noting these parallel promises, Marketplace host Jeremy Hobson quipped, that he promised to create 10,000 jobs if he could be exempted from taxes—honest!

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