ATandT May Hope to Revive FCC Application

By Wayne Rash  |  Posted 2011-11-24 Print this article Print


"They'll have to change their claims about jobs," Schwartzman told eWEEK. In a prepared statement released to the media, he also said, "It is time for vainglorious managers at AT&T to accept that there is no way that this deal can obtain approval of the FCC and the courts."

A senior executive with one of the primary participants in the antitrust suit against the merger, who spoke with eWEEK on background, suggested that the timing of the license application withdrawal may be related to the election cycle in the United States. He said that it's traditional that the FCC chairman will resign to let the incoming president appoint someone of their own party. "They're betting with the Republicans," the source said.

However, the same source said that it's unlikely that Judge Ellen Huvelle will be pleased with the action by AT&T and T-Mobile. "She'll want to know why she's been hurrying to get this going if this is what AT&T is going to do." He also noted that everything in the FCC docket can now become evidence in the antitrust case.

At this point, it's possible that the FCC will still move forward on its referral of the application transfer to an administrative law judge. If all of the members of the commission choose to vote in favor of the order before the commission acts on the license withdrawal, then the case can move forward. A source very close to the antitrust case told eWEEK that AT&T especially fears such a hearing because the FCC is not under the same constraints as the DOJ and can hear evidence and witnesses from everyone who filed objections to the merger.

Most of the actions in this case face a very real deadline of Nov. 30, which is the commission's next meeting. It's also the same date that Congress votes on two new appointees to the FCC. While the published agenda for the Nov. 30 FCC meeting contains nothing about the AT&T action, it was published before the announcement of the license application withdrawal.

In the long run, the move by AT&T and DT could well mean that the merger is done. It's likely that AT&T will continue to fight on in the antitrust case, but the chances of that fight succeeding are diminished by the license application withdrawal.

However, AT&T has vast quantities of money available to fight for the merger through the course and regulatory procedures as long as it has any hope of getting a favorable ruling. On the other hand, DT and its primary owner, the government of Germany, can't afford to wait indefinitely.

DT is facing financial and legal issues in Europe, and needs to make something happen relatively soon. The most likely outcome is that AT&T will try to delay payments to T-Mobile, DT will sue, and once that's settled, the merger will be off and DT will look for another buyer. But what will eventually happen is speculation. 

Wayne Rash Wayne Rash is a Senior Analyst for eWEEK Labs and runs the magazineÔÇÖs Washington Bureau. Prior to joining eWEEK as a Senior Writer on wireless technology, he was a Senior Contributing Editor and previously a Senior Analyst in the InfoWorld Test Center. He was also a reviewer for Federal Computer Week and Information Security Magazine. Previously, he ran the reviews and events departments at CMP's InternetWeek.

He is a retired naval officer, a former principal at American Management Systems and a long-time columnist for Byte Magazine. He is a regular contributor to Plane & Pilot Magazine and The Washington Post.

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