Why AT&T’s deal for T-Mobile must be blocked

Two weeks ago, as it happens, I took my business away from AT&T. The reason? Simple. T-Mobile offered me a better deal.

Lower prices. No two-year contract. And monthy savings because I brought my own phone.

It was a free market. So I moved.

And now, that choice is gone. Sure, you can choose between companies A, B, & C. All of which cost roughly the same, nickel & dime you to death, and make similar efforts to restrict customer freedom.

Did I mention I will theoretically have to pay an extra $50 to use tethering the same way I've been doing since I got T-Mobile?!?

I'm an AT&T customer. But I'm not optimistic about what this deal will mean. I know what it won't mean: cheaper and better service, as guaranteed by a healthy fear of competitors.

My proudest accomplishment in law school was a research paper I wrote entitled "Anti-Antitrust: The Need for Antitrust Law Reform."

In that paper, I argued that antitrust law as applied today totally misses the point: the issue shouldn't be whether a company, otherwise satisfying the elements of a monopoly, is harming competitors, but whether a company is actually harming consumers. Put another way: who is complaining about the alleged anticompetitive tactics: competitors, or consumers?

If one studies all the big antitrust cases of the 20th century -- from Alcoa, to DuPont, to Microsoft -- a curious trend emerges: it was always those companies' competitors who took issue with seemingly anticompetitive tactics of the big evil "trusts," and rarely -- if ever -- was it the consumers themselves.

A great example of this is Microsoft in the 1990s: do any of you -- aside from our realm of early adopter computer savvy tech types -- genuinely remember any everyday computer users actually complaining that Windows came preinstalled with IE instead of Netscape? Were consumers actually harmed, were they actually suffering? No: the only "people" who had an issue with MS bundling IE with Windows -- frankly, a brilliant strategy -- were Microsoft's competitors, and not, in fact, MS's customers.

So my take on this ATT & T-mobile merger is simple: the investigation should not focus on whether ATT/T-mobile is a monopoly from competitors' points of view, but whether it is anticompetitive to the point of actually harming consumers, e.g., with higher prices, etc.

Frankly, a good example of a company that really deserves a DOJ investigation is Apple -- IFF customers start to actually complain, and not not just Apple's competitors' start to complain.

Put more simply: a DOJ investigation into whether a company is a monopoly should be based upon whether consumers -- not competitors -- are actually being harmed by the allegedly anticompetitive tactics of a "monopoly."

After all, a company could not become a monopoly without customers' support in the first place. So clearly they have done something right that customers appreciate.

A "monopoly" that is not causing harm to consumers, either directly or indirectly, is not necessarily so terrible a thing. In fact, as with Apple, it is often the case that consumers enjoy a net benefit from such a company.