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Sprint cheers government move to halt AT&T-T-Mobile deal

It's not often a company will cheer when the government directly intervenes in its industry, but things are different when you face potential oblivion without government action.

RELATED: Feds move to block AT&T, T-Mobile merger

In this light, it's easy to see why Sprint is cheering a Department of Justice decision today to file a civil antitrust suit aimed at blocking the proposed $39 billion merger between AT&T and T-Mobile.

"The DOJ today delivered a decisive victory for consumers, competition and our country," said Vonya McCann, Sprint's senior vice president of government affairs. "By filing suit to block AT&T's proposed takeover of T-Mobile, the DOJ has put consumers' interests first... Contrary to AT&T's assertions, today's action will preserve American jobs, strengthen the American economy, and encourage innovation."

Sprint CEO Dan Hesse has been one of the most vocal critics of the AT&T-T-Mobile merger since it was proposed earlier this year and has persistently argued that such a large wireless company would have "tremendous" power over the wireless market and would be bad for consumers.

"If you take a look at the market power of the big two, in postpaid, which is contracts, the way most users think of the business, in 2005 the big two had 52% market share," Hesse told CNBC's Jim Cramer this past March. "They've expanded that now with acquisitions in the last few years, up to 67%. If this transaction goes through you're talking 79%, or roughly 80% of the market controlled by two companies. I think that's a little too much -- too much concentration."

A study by the Yankee Group released this month claimed that Sprint was likely to become a top acquisition target if the AT&T-T-Mobile merger passed and stated that it was "only a matter of time before Verizon purchases Sprint and adds Sprint's 51 million subscribers to its 95 million, thereby creating a national duopoly."

The DoJ put the future of the merger in doubt, however, when it filed a lawsuit with the U.S. District Court with the District of Columbia today arguing that the proposed merger would significantly damage competition in the wireless industry, especially since T-Mobile has historically offered low-cost wireless voice and data services for customers. The DoJ also contended that any efficiencies gained by combining AT&T and T-Mobile spectrum would not be enough to offset the damage done to U.S. consumers by further consolidation of the wireless industry.

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