FCC Says AT&T's T-Mobile Acquisition Not in Public Interest
Nov 22, 2011, 3:44 PM by Eric M. Zeman
updated Nov 22, 2011, 4:33 PM
Julius Genachowski, chairman of the Federal Communications Commission, has filed a draft order concerning AT&T's proposed acquisition of T-Mobile. In the order, the Genachowski has concluded that the AT&T/T-Mobile transaction is not in the public interest. He believes that the merger would violate antitrust laws, and believes that — rather than create jobs as AT&T claims — the merger will lead to massive job losses. The FCC says the merger would lead to an unprecedented concentration of power held by a few companies, and there is no evidence that the benefits would outweigh the harm. The draft is currently being reviewed by the other FCC commissioners, and won't be fully acted upon until December 13. If the draft order is approved by the remainder of the commission, the petition would then proceed to an administrative hearing, which would be similar to a trial and AT&T would be allowed to defend itself. The hearing would further delay the process of the acquisition, which is already facing a roadblock in the form of an antitrust lawsuit from the Department of Justice. In a call with press held today, the FCC said that it examined hundreds of thousands of pages of documents, met with AT&T and T-Mobile more than 30 times, and received 50 petitions to deny the transaction. It said the paperwork filed by AT&T raises significant questions about the facts of the proposed merger. AT&T announced its intent to buy T-Mobile in March of this year. The Justice Department filed its lawsuit in August, and a trial is scheduled to begin in February 2012. The FCC's hearing — if so ordered — wouldn't take place until after the Justice Department's lawsuit has been concluded. The FCC itself cannot block the merger, but can send it to a judge, who can render a decision. AT&T initially thought the acquisition would go through by March 2012, but later extended the expected close date to June or July of 2012. It isn't immediately clear how much further the close date will be delayed by this move from the FCC. The FCC has, however, approved AT&T's purchase of 700MHz spectrum from Qualcomm. AT&T said, "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 U.S. economy desperately needs both. At this time, we are reviewing all options."
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Comments
AT&T-T-Mobile withdraw FCC applications; still intend to pursue merger
Hmm, the timing of the press release -- 2:30am on Thanksgiving morning -- is odd to say the least. Usually when companies do a weekend or holiday news dump like this, they do so in an attempt to bury bad news. This could be the first admission of defeat, and it would not be all that surprising if AT&T and T-Mobile were to formally call...
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ding dong the deal is dead...
AJ
However the outcome, it seems tmobile will be in a worse off situation than before the merger announcement in March. If only they had the iphone....
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oh no!
hmmm
