FCC bashes AT&T/T-Mobile merger in public report

The Federal Communications Commission released a 109-page report on Tuesday evening that provides a great deal of insight into what the government agency thought of AT&T’s planned acquisition of T-Mobile USA. However, AT&T has questioned exactly why the government agency decided to release the report since, hours before the report was released, AT&T successfully withdrew its merger application. The FCC said that the acquisition would give AT&T a “unilateral incentive” to increase its prices, which could have had an echo effect on the industry should Sprint and Verizon Wireless follow suit, The Wall Street Journal reported. Read on for more.

AT&T promised the deal would create thousands of jobs and that it would bring back 5,000 call center jobs from overseas. The Communications Workers of America also argued the merger could create as much as 96,000 jobs for Americans. Even still, the FCC argued in the report that the acquisition would “result in a net loss of direct jobs.” As one might imagine, AT&T isn’t pleased with the FCC’s decision to release the report.

“The FCC has recognized that it is required by its own rules to dismiss our merger application,” AT&T senior executive vice president of external and legislative affairs Jim Cicconi said. “This makes all the more troubling their decision to nonetheless release a preliminary staff report on the merger. This report is not an order of the FCC and has never been voted on. It is simply a staff draft that raises questions of fact that were to be addressed in an administrative hearing, a hearing which will not now take place. It has no force or effect under law, which raises questions as to why the FCC would choose to release it. The draft report has also not been made available to AT&T prior to today, so we have had no opportunity to address or rebut its claims, which makes its release all the more improper.”

AT&T decided to withdraw its application to acquire T-Mobile USA to instead focus on a lawsuit brought against the merger by the Department of Justice. That case is expected to begin in February. Should AT&T win, it’s expected that the carrier will re-apply for the merger’s approval with the FCC.

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