AT&T announced on Monday that it has officially withdrawn plans to acquire T-Mobile USA from Deutsche Telekom, effectively ending the $39 billion merger deal that the two telcos sealed earlier this year.

While the two companies showed eagerness in completing the agreement bared in March this year, the U.S. blocked the transaction that it claimed would hurt industry competition and increased cost of services with only two major players left to tussle in the field, the other one being Verizon.

Washington also declared that the AT&T-T-Mobile merger would eliminate choices enjoyed by U.S. consumers in the current telecommunication market set-up.

The federal posturing was eventually backed by the decision issued by the U.S. Federal Communication Commission (FCC) that mostly echoed the arguments floated by the U.S. government, paving the way for the elimination of the deal.

As a precursor to this week's announcement, both AT&T and T-Mobile notified the FCC in November that the deal was off.

AT&T had argued that its corporate marriage with T-Mobile would have solved the spectrum shortages that have been nagging the mobile services in America but many experts maintain that the country's second largest telco has largely exaggerated the so-called spectrum crisis.

Telco experts believe that AT&T has yet to tap its full spectrum capability and has erred in addressing its network congestions issues by expanding its mobile tower networks instead of deploying its spectrum reserves.

Gobbling the resources of T-Mobile, experts stressed, will not open new airwaves for AT&T as the latter's networks are already occupied by subscribers, who in the event of the merger going ahead, will merely change the name of their provider but not their existing infrastructure.

If indeed AT&T's issues are valid, those can be solved by acquiring more spectrum rights from existing telecommunication firms, which experts said merely requires administrative supervision from the FCC.

With the takeover plan officially dead, AT&T is now required to pay Deutsche some $4 billion, $3 billion of which for the break-up fee and another $1 billion to cover for airwaves expenses that need to be turned over to the German firm.

To avoid future airwaves issue, AT&T has also urged U.S. authorities to possibly expedite the approval of its application to purchase the unused spectrum of Qualcomm.

The company added that legislative measures need to be seriously considered in ensuring that existing telco infrastructures will meet mobile telecommunication advancements.