By Emily Grannis
The U.S. Department of Justice and the state of Vermont filed suit today against Verizon Communications, asking the U.S. District Court in D.C. to enjoin a merger between Verizon and Rural Cellular Corp.
The Antitrust Division contends the proposed merger would concentrate Verizon’s control in six areas of Vermont, New York, and Washington state, nearly eliminating the possibility of competition and reducing incentives to keep prices low.
The complaint argues that any attempt from another company to enter the market would not counteract the harm done by the merger. The entry of another company, the Antitrust Division says, “would not be timely, likely or sufficient to thwart the competitive harm resulting from Verizon’s proposed acquisition of RCC.”
Verizon is the second-largest wireless telecommunications provider in the country, based on subscribers, with more than 65 million subscribers in 49 states. RCC is the 10th largest, with approximately 790,000 customers in 15 states, according to the complaint.
In the six areas of concern, Verizon and RCC are the two largest companies, serving more than 60 percent of subscribers, and represent each other’s biggest competition.