Just because a small carrier doesn't operate coast-to-coast today doesn't mean it won't tomorrow. If big companies boost their rates, they give upstarts the chance to build their business with alluring discounts. They also encourage the entry of new rivals. The market has its own ways of deterring rip-offs, and those methods are typically faster and surer than federal intervention.
Justice says it particularly wants to keep T-Mobile around because it has been "a disruptive force through low pricing and innovation by competing aggressively." It sounds like a great business formula. But the virtues the government lawyers cherish seem to have less appeal with consumers.
If those are such wonderful attributes, why has T-Mobile been losing customers instead of gaining them for the past year and a half? Maybe many of them prefer the better options that go with the higher rates at Verizon and AT&T.
Besides, it's not as though keeping T-Mobile around is a long-term possibility. Its owner, Deutsche Telekom, has made it clear it wants out of the United States. "This market is going to consolidate one way or another," Sanford C. Bernstein analyst Craig Moffett told The New York Times.
Nor is it true that fewer carriers are bound to mean higher prices. As the Federal Communications Commission noted in its June report on the state of wireless competition, the industry has gotten significantly more concentrated in recent years -- but rates for both calls and text messages have declined.
It's a development that should give pause to anyone inclined to meddle in this business. The telecommunications marketplace is a dynamic environment that has repeatedly produced surprises.
Remember when Apple seemed to be doomed to extinction? Remember when people expected AOL-Time Warner to rule the world?
Regulators often act as though companies can claim a big share of a market as though they were cutting a piece of pie. Generally, it's more like trying to fence off a cloud.
In a capitalist economy, corporations may try to position themselves to gain enduring control. But in the end, they always learn that consumers rule.
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