The Obama administration on Wednesday filed to block AT&T Inc's $39 billion proposed acquisition of T-Mobile USA from Deutsche Telekom due to anti-competitive concerns.

The news sent AT&T shares down more than 3 percent and Deutsche Telekom shares fell nearly 7 percent. Shares of rival Sprint Nextel Corp jumped nearly 10 percent.

Here are some comments on the news:

STEVE CLEMENT, ANALYST AT PACIFIC CREST

It's surprising. Clearly AT&T didn't expect this. AT&T put itself in a position where it would have to pay a hefty break-up fee to T-Mobile USA.

It changes things for them with respect to the spectrum flexibility they'd have. They're going to have to be in the market to buy incremental spectrum.

It's mixed for Sprint. On the one hand, they were potentially going to lose T-Mobile USA as a competitor at the low end of the market. Now it's going to face a T-Mobile that's in a better position prior to the merger proposal, with extra cash and spectrum and a new roaming agreement with AT&T.

It also puts T-Mobile USA back in play as a potential merger candidate for Sprint.

JAMES COLE, U.S. DEPUTY ATTORNEY GENERAL

The Department filed its lawsuit because we believe the combination of AT&T and T-Mobile would result in tens of millions of consumers all across the United States facing higher prices, fewer choices and lower quality products for their mobile wireless services.

Right now, four nationwide providers account for more than 90 percent of the mobile wireless connections in America, and preserving competition among them is crucial. For instance, AT&T and T-Mobile currently compete head-to-head in 97 of the nation's largest 100 cellular marketing areas. They also compete nationwide to attract business and government customers.

Were the merger to proceed, there would only be three providers with 90 percent of the market, and competition among the remaining competitors on all dimensions-including price, quality, and innovation-would be diminished.

(Reporting by Sinead Carew, compiled by Tiffany Wu)

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