But a big question, industry analysts say, is whether the mobile industry will be genuinely more competitive and innovative with T-Mobile as a stand-alone company.

The two biggest carriers, analysts note, are gaining subscribers, while their smaller national rivals, Sprint Nextel and T-Mobile USA, a unit of Deutsche Telekom, are losing ground.

“The gap between the haves — ATT and Verizon — and the have-nots, which is essentially everybody else, is only getting wider,” said Kevin Smithen, an analyst for Macquarie Securities.

Craig Moffett, an analyst at Sanford C. Bernstein, agreed, saying: “This market is going to consolidate one way or another.”

But in taking action, the Justice Department is making a bet that this is not necessarily the case. And its analysis concluded that the anticompetitive risk of allowing ATT to reduce the ranks of the four largest carriers — which provide more than 90 percent of mobile wireless service in the country — to three was too great.

Wireless looks to be the communications and computing technology of the future, as sales of smartphones and iPads surge and people increasingly use them for sending and receiving messages, reading, and playing games. Competition among mobile carriers, then, is clearly important to both consumers and the economy.

But even if the deal goes through, other forces could eventually shake up the tiny club of large wireless companies. There are upstart carriers, led by MetroPCS, which offer discount service and prepaid plans, enjoy strong positions in some local markets and have national ambitions. A specialist company, LightSquared, is selling capacity on its high-speed wireless network at wholesale rates to niche carriers.

The Federal Communications Commission has begun prodding broadcasters to free up wireless spectrum, opening up more potential opportunities for newcomers to the market. And powerful companies like Google, Apple and Microsoft, with deep pockets and a stake in mobile computing and communications, could also step in and change the game, analysts note.

The mobile market is “a fast-shifting chessboard these days,” said Kevin Werbach, an associate professor at the Wharton School of the University of Pennsylvania and a former counsel for new technology policy at the F.C.C.

“If the ATT merger with T-Mobile fails,” Mr. Werbach added, “it will shuffle the pieces still more.”

Yet the Justice Department was faced with a decision about the near-term impact of a huge merger, rather than one about the possibility of new entrants or new technology stimulating competition years down the road.

ATT had argued that adding T-Mobile would give it the extra network capability it needed to fairly quickly roll out the next generation of high-speed service — so-called 4G — across the nation.

The Obama administration has championed the accelerated rollout of faster wireless service as an important foundation for innovation and future growth. But the administration’s antitrust regulators decided there were other ways for ATT to do that without taking out a competitor.

For one, the company could just invest in expanding its own network. Another approach, analysts say, is network-sharing arrangements with T-Mobile and other carriers. That way, rivals avoid the redundant investment of building cell towers side by side. But the companies remain separate and still compete on service in those markets.

“Network-sharing arrangements are common in some European markets,” said Jan Dawson, an analyst at Ovum, a technology research firm. “You get some of the same benefits, without running into the kind of antitrust concerns ATT has with T-Mobile.”

T-Mobile USA’s German corporate parent wants to get out of the United States, and concentrate its resources elsewhere. But the unit’s assets — its wireless spectrum and network of cell towers — could be sold off to others who might sustain a fourth national competitor, like cable, satellite or technology companies that want to offer wireless service, according to some analysts.

The potential for bigger wireless bills for consumers if T-Mobile was acquired by ATT, legal experts say, was a crucial part of the Justice Department’s analysis. T-Mobile offers smartphone service with voice and data plans that, in some markets, are cheaper than ATT by 20 percent or more. Lower prices are the most easily measured consumer benefit of competition, and in merger cases, the government typically looks at the potential for price increases of 5 percent to 10 percent or more as significant.

ATT has some sought-after offerings that T-Mobile does not, like Apple’s iPhone. But, according to the Justice Department, ATT’s prices would have been higher without the competitive pressure from T-Mobile.

ATT, when advocating for the deal announced in March, repeatedly said that the merger should be judged not by the impact on market share nationally, but by the impact on local markets, where there are often smaller, regional competitors.

In its complaint and supporting documents, the Justice Department said it had examined local markets carefully. In more than half of the 100 larger markets, for example, the T-Mobile-ATT combination would have more than 40 percent market share.

In its way, the government complaint tells a story, portraying T-Mobile as a particularly important competitor. With its pricing plans, T-Mobile has led in making smartphone service affordable to a mass market. T-Mobile, the government states, was an early adopter of smartphones that used Google’s Android operating system.

“The picture presented is that T-Mobile is not just any competitor, but a ‘maverick,’ in the term of art used in antitrust,” said Andrew I. Gavil, a professor at the Howard University law school. “So if it’s acquired, you remove a disruptive, innovative force from the marketplace.”

Article source: http://www.nytimes.com/2011/09/01/technology/can-t-mobile-carry-on-as-stand-alone-company.html?partner=rss&emc=rss