FCC Chairman: I’m Going To Kill This Anti-Competitive AT&T / T-Mobile Deal

FCC Chairman: I’m Going To Kill This Anti-Competitive AT&T / T-Mobile Deal

Julius Genachowski, the chairman of the U.S. Federal Communication Commission, has spoken out about AT&T’s proposed acquisition of  T-Mobile and deemed the merger to be against the public interest. Genachowski has called for commissioners to vote for an administrative public hearing against the $39 billion, which could prove to be a huge setback for the two carriers.

Genachowski issued a draft order today in which he asks the other four commissioners to call for an administrative hearing, and says the merger would create an “unprecedented” level of concentration in the wireless market. He argues that it is impossible to see how the deal could be beneficial to the U.S. public.

As you’d expect, AT&T isn’t happy about the move. Larry Solomon, the carrier’s Senior Vice President of Corporate Communications, said the FCC’s actions are disappointing, and that the U.S. economy “desperately” needs the jobs that the merger will create:

“The FCC’s action today is disappointing. It is yet another example of a government agency acting to prevent billions in new investment and the creation of many thousands of new jobs at a time when the US economy desperately needs both.”

However, the FCC disagrees, and claims that in fact, jobs would be lost as redundant positions are cut as part of the move. While AT&T claims jobs will be created for the rollout of the company’s 4G LTE network, the FCC argues that there’s no evidence to suggest the buyout would help speed up the proposed 4G rollout.

The FCC isn’t the first to oppose the merger; unsurprisingly, Sprint has also filed a formal petition with the FCC against the deal. As things stand, it’s certainly not looking good for AT&T.

[via AppleInsider]

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  • T Stack

    Another unelected bureaucrat dictating to markets…

  • bplano

    This looks like a truly evil building.

  • Robert Menes

    A small history lesson:

    AT&T’s logo was once drawn as an exploding Death Star, with Rebel Alliance fighters speeding away from it. This was in response to BSD partisans, who regarded AT&T’s Unix as inferior.
    (source: http://www.catb.org/jargon/htm

    Nowadays, though, the Death Star logo is more in line with the fact that if AT&T were to merge, it would create, in all essence, a superweapon capable of destroying competitors in a single blow.

  • Jordan Clay

    Wow,  so much for free markets

  • Eric McCormick

    Mergers never add jobs, at least not domestically. Does anyone actually think that AT&T eating T-Mobile would somehow be good? It’ll decrease competition, eliminate existing jobs, and give no incentive for AT&T to not be anything other than AT&T (as opposed to an innovative, competitive AT&T).

  • Blasphemy!

    Tmobile is not competitive. They have a crapload of mediocre 4g android phones and no future with any of Apples products. The worst part is they don’t care if they partner with Apple, they seem contented selling their crap handsets to the masses. Smh

  • Agree (with Alumnus)

    T: all comissioners are unelected: by definition – even with corporations being “people” according to the reTHUGlican supreme court, they only have one vote, and could never ever have enough votes to actually elect a comissioner… even of these positions were subject to a popular vote…

    market regulation is absolutely necessary because an unregulated market will destroy wealth – as seen in the housing market, etc…

  • Agree (with Alumnus)

    Jordan: there is no such thing as a ‘free market’… in a situation where the players are ‘too big to fail’ by definition there is no free capitalism… If you are willing to bail out corporations and banks on the shoulders of the taxpayer – in effect socialize the losses – and give the benefits of success only to the shareholders – privatize the gains – then the market is not free…

    true, a ‘free market’ should reap the rewards of success, but also must bear responsibility for failure (which the corporations that are too big to fail do NOT do)

    corporations shoupd not be permitted to burden the taxpayer by their screw-ups… CEO’s in the ‘free market’ model should be held personally and fiscally responsible for their screw-ups in driving corporations into the ground and NOT given massive termination benefits on their way out the door… The excuse is that they had a contract, but then again, buying stock in a company is also a contract that a company fails to honor as it is collapsing and the rats are escaping the sinking ship…

    Point: no such thing as ‘free markets’…

    Point 2: it is incredibly stupid to use the Greenspan model that markets will regulate themselves responsibly… they simply will not…

  • Agree (with Alumnus)

    It IS!

    As is their customer ‘service’…

  • Brandon Dillon

    I live in Nashville, and at night, it is beautiful.

    You’re right though.

  • MacRat

    “Another unelected bureaucrat dictating to markets…”

    You think there is something to benefit consumers by one company having a 100% monopoly on GMS in the US?

  • sir1jaguar

    People keep on saying that TMOBILE has crapload of phones are stupid and moron…

    They are always first in releasing the first in the market like android phones, windows, blackberry, nokia and others…

    The htc amaze and SAMSUNG galaxy s2 can easily reach 22-28mbps and the camera are super great….

    Please research and check how tmobile innovate in the USA since they started to make business in the USA…

    They are the first carrier who did the built in wifi calling on the phone, unlimited worldwide messaging for super low rate, first hspa+ 42 Mbps with the most places covered and lots more…

    Their plans are great with employee discounts that no one can beat their lowest plan…

    I was with AT&T for 8 years and it’s the most horrible experience like dropped calls, super slow internet, horrible customer service and more problems that’s why they are always dead last in every survey when in terms of quality of service…

    STOP THE MERGER…

  • bombastinator

    wait..  Your reasoning for destroing them is that they don’t carry apple phones?!  Dude, they;re a budget carrier.  I get 1500 minutes, 4g 250 gig then unlimited 2g, a ton of text messages (there is a limit but I’ve never hit 10% of it) for ~60/mo+ fees.  And I’ve had it for years.  Closest build I could make on ATT wasn’t that good and it was well over $100.

    You think that’s non-competitive?  Who give two what phones they carry?  They’ll support ANY phone I hand to them, and for the $40/mo I’m saving over two years I can buy anything at all unlocked including any iPhone, and still save money.  I get a discounted phone every 2 years too, but I don;t bother to use it.  STILL cheaper.  Last time I bought one anyway and sold it for the equivalent of 2 months fee service. Gonna be rickin a nexus when they come out in a month and I’ll still be paying less than some poor schmuck on ATT with a 3gs.

  • bombastinator

    It is clear you don;t know what that word actually means.  free market ? dualopoly.  Someone has been lying to you.

  • bombastinator

    you are clueless.

  • Dilbert A

    I hear the empire’s music from Star Wars when I look at the picture

  • Ruben Karapetian

    Thank the FCC. I would leave T-Mobile the day AT&T takes over. I joined T-Mobile to get AWAY from AT&T. I’ve never had a problem with T-Mo ,but AT&T thats a different story. 

  • thesmilingfaces

    FreeMarket, I agreed with almost everything you said, but then lost me at , “…markets will regulate themselves responsibly…” 
    Market’s always regulate themselves in their self interest, and this is almost, by definition, “responsible.” They almost always do. Do you really think it’s a good business plan for restaurants to kill their customers? If they did, they are held liable, sued, put out of business, and where a nice Scarlet A the rest of their life. Do you think Apple, or even the customers of Apple, would have been better off if the Government had to OK every business decision that effected it’s customers? (I use Apple in this example because I never understood the hypocrisy in singling out oil companies for being greedy, when Apple has more cash than Exxon on hand… yet, still charge $2000 a laptop. Where is the outrage?)

    Now, there are situations which you describe that come up because there are perverse incentives in place, like you mentioned.Yet, these incentives are almost always put there by government. To compare the financial mess of CDO’s and derivatives to the merger between T-Mobile and AT&T is really off-base. You are painting “regulation” with such a broad stroke that is impossible to conceive a scenario where two companies would not have to ask the government to merge. At the end of the day, there is such thing as a “free market”. It’s what we see in industries where Government doesn’t have a massive department attempting to “regulate” it. (Which begs the question, who regulates the regulators when government is this big and hides from the public?)My point:  If T-Mobile wants to sell, and AT&T wants to buy, who the hell is the FCC to say they shouldn’t be able to? 

  • thesmilingfaces

    When the alternative sucks, yes. If it starts to charge higher prices, CDMA is a great alternative. One of the reasons stated for not allowing this merger was that redundant jobs would be destroyed in the process. Uh, that’s the point. Why would you hire 2 people when 1 person can do the job? What worse, why is this a bad thing, or even a stated reason in the first place?

    Additionally, Wireless companies are going to be put under within 5 years when someone can correctly harness open-Wifi networks to create a carrier-less calling network. It’s a matter of time. Greedy customers like you and I hate paying month to month and being stuck in contracts. Because we are greedy, another greedy business man is busy trying to figure out how to lower our monthly bill. How evil of him.

  • thesmilingfaces

    It is wrong to have unelected persons, who make all decisions behind closed doors and need not give an explanation, issuing drastic decisions (like this one) that effect our day-to-day lives. Again who regulates the regulators? What’s to stop them from colluding with these companies? Then you literally have a legal entity to either stop competition and force it’s own inefficiency on all of us.

    For example, if I were to tell you that actually Verizon was behind all the FCC reps — not far from the truth actually — would this make you feel better? What if I told you Verizon is in fact trying to stop their competition from getting into a situation where it can lower our monthly bills and attract more customers away from Verizon? What if…

  • crateish

    What about the anti-competitive Comcast/NBC deal? Oh, right. An FCC member got a board membership out of it. That makes it ok.

About the author

Killian BellKillian Bell is a staff writer based in the U.K. He has an interest in all things tech and also covers Android over at CultofAndroid.com. You can follow him on Twitter via @killianbell.

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