The FCC divides the country up, in terms of wireless spectrum, into CMAs or Cellular Market Areas.
In their recent suit against AT&T, the US Department of Justice gauged the effect of a T-Mobile acquisition across the top 100 CMAs, in which over half of the US population resides and the Big Four (AT&T, Verizon, T-Mobile, Sprint) directly compete.
In Appendix B of their filing, our anti-trust enforcers list the effects on market share of T-Mobile being absorbed into the Death Star: AT&T would have 43.7% of New York’s market, 58% of Dallas-Fort Worth’s, 41.9% of Denver-Bolder’s, and 48.1% of Los Angeles-Long Beach’s.
So which of these 100 CMAs—as if you didn’t know by now— did AT&T take the largest market share?
That would be Baton Rouge, LA.
Here’s another factoid. The Justice Department refers to another measure of market concentration called the Herfindalhl-Hirschman Index. It’s pretty simple formula that takes into account both the market share and the number of competitors: take the market share as a percentage, square it, and then sum it.
So in the case where two competitors evenly split a market, the HHI is 5000 (502 + 502).
As a general rule, markets above an HHI of 2500 are considered to be highly concentrated.
So which CMA has the honor of having the highest HHI in a post-acquisition world?
That would also be Baton Rouge at 4800.
But second place, drum roll please, goes to Jersey’s own Long Branch-Asbury Park.
Darn, I don’t have an appropriate Springsteen lyric to end this post.
Related articles
- US v. AT&T! (technoverseblog.com)
