ATandT-T-Mobile Merger Job Claims Fuel Bitter Debate Over Antitrust Suits

News Analysis: The relentless series of AT&T commercials stating there will be huge job growth if its buyout of T-Mobile is allowed to go through is drawing fire from opponents who contend the claims are false.

WASHINGTON - The steady drumbeat of advertisements by AT&T claiming huge job growth if the merger with T-Mobile is allowed to go through is impossible to escape in Washington.

The ads appear daily in everything from newspapers to bus signs to broadcast commercials. Each time, the claim is the same-if AT&T is allowed to acquire T-Mobile, it will result in 96,000 new jobs, plus 5,000 jobs brought back to the U.S. from overseas. The ad seems to imply that AT&T will help spur job growth in the struggling U.S. economy to an extent that even the government can't manage.

Of course, if you read the fine print that accompanies these ads, you'll see that most of those numbers are highly speculative, but the ads trumpet them nonetheless. Now, aneconomic study, sponsored by mobile competitor Sprint but carried out by David Neumark, professor of economics at the University of California, Irvine, suggests otherwise.

The study says that contrary to its claims, AT&T's merger with T-Mobile will almost certainly result in the loss of thousands of jobs as redundancies are eliminated, staff streamlined and costs reduced. The Neumark study claims that previous AT&T mergers have resulted in significant job losses and that in the period leading up to the merger, AT&T was already shedding U.S. jobs. The study also noted that during the same period T-Mobile was adding jobs, a trend the study indicated would be reversed after the merger.

All of this was presented at a high-profile news conference Nov. 8 in the new Capitol Building Visitors Center. The media event also included representatives from the Media Access Project (MAP), a public interest group opposing the merger that is trying to get AT&T's advertising dropped by media outlets because it is, the group claims, not truthful.

AT&T, in response to the MAP claims, has said that the company has a First Amendment right to run those commercials. Currently, MAP has approached one television station in Washington, the highly rated CBS affiliate WUSA-TV, and formally requested that the station stop carrying the ads. There's no indication of how the television station plans to respond.

For its part, the supporters of AT&T also had their own news conferences. The Communications Workers of America released a study of its own claiming that AT&T really will manage to come up with 96,000 new jobs. The CWA is backing the merger because T-Mobile isn't unionized, and if the merger happens, the CWA is counting on signing up those new employees as union members, assuming they still have jobs after the merger.

Adding to the day's merger media madness, think tank Tech Freedom presented a discussion by George Mason University professor Josh Wright about the AT&T-T-Mobile merger.

Wayne Rash

Wayne Rash

Wayne Rash is a freelance writer and editor with a 35 year history covering technology. He’s a frequent speaker on business, technology issues and enterprise computing. He covers Washington and...