WASHINGTON — Nextel Communications Inc. is in discussions with AT&T Wireless about a merger that would create a $100-billion enterprise with about 18 million customers in markets across the country, sources with knowledge of the talks said Thursday.
The conversation highlights the continuing quest for scale within the telecommunications world, and analysts said a deal could help alleviate fundamental problems confronting the two companies: Nextel, a fast-growing business in danger of exhausting its limited rights to the airwaves, would gain an enormous partner. AT&T Corp., deep into a rocky transformation from an old-fashioned long-distance company into one focused on wireless and the Internet, would take another leap.
But legal experts said an AT&T-Nextel combination could encounter resistance at the antitrust division of the Justice Department, which has recently shown willingness to challenge major telecommunications mergers.
Reston, Va.-based Nextel and AT&T now compete head-to-head in virtually every major market. In several mergers involving wireless companies with overlapping businesses--most recently when SBC Communications Inc. and BellSouth Corp. combined their mobile holdings--the Justice Department has forced the sale of substantial properties as a condition of approval.