Thursday, December 1, 2011

FCC Merger Report Release "Improper," AT&T Claims

AT&T Relevant Products/Services expressed its dismay Tuesday over the release of a new Federal Communications Commission report concluding that the carrier's proposed merger with T-Mobile raises significant competitive concerns due to the increased likelihood of unilateral and coordinated effects.

Though AT&T withdrew its merger application Relevant Products/Services before the FCC last week, the commission nevertheless released its preliminary report on Tuesday. The U.S. wireless Relevant Products/Services operator called the action "troubling."

According to AT&T Senior Vice President Jim Cicconi, the report merely raises questions of fact that would have been addressed in an administrative hearing if AT&T hadn't already withdrawn its application. "It has no force or effect under law, which raises questions as to why the FCC would choose to release it," Cicconi said Tuesday.

Cicconi also complained that the FCC had not provided AT&T with a copy prior to its release. "We have had no opportunity to address or rebut its claims, which makes its release all the more improper," Cicconi said.

According to FCC member Mignon Clyburn, however, this week's release of a preliminary report on AT&T's proposed merger with T-Mobile was entirely proper. Among other things, he said, it "promotes federal agency transparency."

Pricing Consumers Right Out of Broadband

According to Clyburn, the U.S. wireless industry in general deserves to know what the FCC's staff had concluded. "Several outside parties have spent considerable time and resources to respond," Clyburn noted, "and they deserve to see the staff's analysis of the record."

In light of AT&T's continuing efforts to acquire T-Mobile's assets through negotiations with U.S. antitrust authorities, Clyburn said both wireless carriers would benefit from knowing what the FCC staff had learned after seven months of research. From AT&T's point of view, however, the FCC report has made its path to a successful merger even more daunting due to the scope and number of the potential objections it raises.

For example, the report expressed concern about the competitive effects that T-mobile Relevant Products/Services's merger with AT&T would have on wireless markets ranging from roaming, wholesale and resale services, to backhaul access Relevant Products/Services and handset availability.

What's more, T-Mobile's current business model specifically targets budget-conscious consumers, and there would have been no guarantee that the proposed merger would have continued to serve the needs of lower-income Americans. (continued...)

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