AT&T Inc (Dallas, Texas) could greatly expand its network capacity for a fraction of the cost it plans to shell out to buy T-Mobile USA, Sprint Nextel (Overland Park, Kan.) said on Monday.
Sprint, a vocal opponent of the deal, said it would present the U.S. Federal Communications Commission (FCC) later on Monday with a technical analysis detailing the actions AT&T could take to improve its network without acquiring T-Mobile USA.
The proposed merger, which requires FCC and Department of Justice approval, would concentrate 80 % of U.S. wireless contract customers in just two companies -- AT&T/T-Mobile and Verizon Wireless.
Sprint said its filing to the FCC will assert that AT&T could forgo the T-Mobile takeover and increase its network capacity by more than 600 % by 2015 by simply putting its current resources to better, more efficient use.
AT&T argues that it needs the spectrum of Deutsche Telekom AG's T-Mobile USA to expand high-speed services faster and improve its network performance, criticized by consumers for dropped calls and slow data speeds.
Sprint, considered the carrier with the most to lose from the AT&T deal, as it would put it in a distant third place in the U.S. market, called this rationale unfounded.
"AT&T could increase its capacity by developing its warehoused spectrum, accelerating its 4G network buildout, and implementing a more efficient network architecture," Sprint said in a statement.
A 600 % boost in capacity could handle AT&T's projected data demands and would cost far less than the $39 billion AT&T would spend to take over T-Mobile, Sprint said.
An AT&T spokesman responded by criticizing Sprint's transfer of its network management to Ericsson . "A company that has outsourced the management of its own network shouldn't be giving advice to others."
The public interest group Public Knowledge also said on Monday it would file a preliminary economic and technical report questioning both AT&T's spectrum constraint claims and T-Mobile USA's financial hardships.
"The report argues both companies have many options to increasing their high-speed data networks," a spokesman for the group said in a statement.
(Reporting by Jasmin Melvin; Editing by Tim Dobbyn)