Skeptics Question AT&T's Logic In T-Mobile Deal

When AT&T officials announced plans to buy T-Mobile USA for $39 billion, they cited the so-called spectrum crunch as a big reason for the merger. AT&T says it needs more wireless spectrum to avoid dropped calls and to satisfy its customers' growing hunger for data.

Now government regulators are asking AT&T to back up those claims. AT&T officials like Ralph de la Vega argue the company needs to acquire T-Mobile's network to keep up with the fast-growing demand for data. "Our data usage has grown 8,000 percent over four years; our own estimates say it's gonna grow eight to 10 times in the next five years," de la Vega said at a wireless conference earlier this year. "So it's in the public interest that we solve that pending spectrum exhaust issue in major cities by this combination." It's an assertion federal regulators are likely to examine closely. Late in May, the Federal Communications Commission asked AT&T for more information about any "spectrum constraints" the company is facing. Skeptics, including Sprint Vice President of Government Affairs Larry Krevor, think AT&T will have a hard time proving its claims. "AT&T has more spectrum, more licensed spectrum, than any other carrier in the country," Krevor says.