AT&T Inc. is ending its $39 billion bid to buy T-Mobile USA, it said Monday.
The decision followed fierce government objections when the Justice Department sued to block the merger, saying it would reduce competition and lead to higher prices.
The mobile phone giant said the government's actions to block the deal do not change the challenges of the wireless phone industry. AT&T said the industry needs more airwaves, or spectrum, to expand.
In a statement, AT&T said the deal would have solved the problem for a time, and without it, customers will be harmed, and much-needed investment will be discouraged.
It then called on the government to quickly approve a purchase of unused spectrum from Qualcomm Inc. and come up with legislation to meet the nation's long-term needs.
AT&T is the second-largest U.S. wireless carrier behind Verizon Wireless. It faces paying Deutsche Telekom of Germany $3 billion in cash and may have to enter into a roaming agreement with Deutsche Telekom while transferring it the rights to spectrum it doesn't need, all in preparation for the next-generation "4G" network.
The purchase of T-Mobile from Deutsche Telekom the largest cellphone company in the U.S. T-Mobile is the fourth-largest. Last Month, the companies withdrew their application to the Federal Communications Commission after its chairman also opposed the deal.Copyright © 2014, Los Angeles Times