U.S. Suit to Block ATandT, T-Mobile Deal Draws Sharp Interest Group Reaction

 
 
By Wayne Rash  |  Posted 2011-09-01 Email Print this article Print
 
 
 
 
 
 
 

News Analysis: Now that the U.S. Department of Justice has filed an antitrust suit to block AT&T's buyout of T-Mobile, all sides are weighing in on the noisy process that many see as a vain attempt to persuade somebody--anybody--to change their minds.

When you see the outpouring of comments regarding the antitrust lawsuit filed in the U.S. District Court for the District of Columbia on Aug. 31 to block the proposed merger of AT&T and T-Mobile, it brings to mind the line from Shakespeare's Macbeth: "Sound and fury, signifying nothing." But in reality, the sentiments-pro and con-signify a great deal, even if they may not influence the lawsuit at all.

The first people I heard from were the opponents of the Department of Justice action, expressing their surprise that it happened. First out of the gate after the principals gave their predictable responses was the Competitive Enterprise Institute, a conservative think tank here in Washington. The institute somehow decided that the merger of AT&T and T-Mobile was pro-competitive, even though it would effectively eliminate competition for GSM phone users. The institute's headline explains its thinking: "DOJ Antitrust Lawsuit Subverts Free Enterprise, Job Creation."

Shortly after that, I heard from two representatives of the Hispanic community. One, the Hispanic Chamber of Commerce, claims that the DOJ antitrust lawsuit hurts Hispanic businesses in the United States. The USHCC notes that AT&T has promised to spend $8 billion in technology investment and bring 5,000 jobs back to the U.S. The organization does not say how this is better for Hispanic businesses than lower prices and more competition.

The other Hispanic group, the National Hispanic Media Coalition, claims the merger between AT&T and T-Mobile would hurt Hispanic people. "We applaud DOJ for taking this important step to prevent consumers from being steamrolled over in AT&T's brazen attempt to pad its pockets and eliminate competition," said Alex Nogales, the group's president and CEO. The NHMC is an advocacy group backing employment and equal programming opportunities for Latinos and other people of color.

NHMC Vice President of Policy and Legal Affairs Jessica Gonzales told eWEEK exclusively: "It's wonderful to see that the DOJ is enforcing antitrust laws and putting consumers first. For years we have seen Goliath dominate David. And yesterday the little guy won. We are anxiously awaiting a final decision that similarly puts the will of the people before giant corporations, and upholds competition, lower prices and jobs for Americans."

On the job front, the Communications Workers of America said in a story published in International Business Times that blocking the merger would cost up to 96,000 U.S. jobs, but didn't say how it arrived at that number. Perhaps revealing its true motives, the CWA also slammed T-Mobile for being non-union.

Most telling, however, is the response from rural America, the large portion of the country that AT&T promises to help by bringing high-speed communications to 97 percent of the U.S. Despite that promise, the Rural Telecommunications Group, which represents rural wireless carriers, sees the antitrust lawsuit as a good thing. In a prepared statement, the RTG's General Counsel Carri Bennet said, "DOJ's pre-Labor Day decision (less than 4 months after AT&T filed to acquire T-Mobile) shows that there is no question that this merger would have been bad for rural America, rural consumers, and rural carriers."



 
 
 
 
Wayne Rash Wayne Rash is a Senior Analyst for eWEEK Labs and runs the magazine's 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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