AT&T Merger With T-Mobile Garners House Democrat Support
Outside of AT&T or T-Mobile executives, there really hasn’t been an outpouring of support for the two telecom’s pending merger. In fact, there has been some pretty vocal opposition. Sprint is naturally leading the charge, but even members of both houses of congress and members of the FCC have voiced concern over what would create a duopoly in terms of US cellular carrers.
However, today, a letter signed by 66 democrats in the House of Representatives was sent over to the FCC, strongly urging the approval of the merger. Without too much digging, thanks to sites like OpenSecrets.com, one quickly discovers that AT&T was one of the largest campaign contributors to the letter’s author, Representative G.K. Butterfield (D, N.C.).
That aside, what the letter says is true. A merger would allow for better 4G coverage nationwide, and would improve coverage in rural and underserved areas. And while rolling out this coverage, it would create jobs in those areas.
There are also some undeniable drawbacks that are hard to quantify. A merger would likely mean the elimination of some jobs. There would inevitably be some crossover in certain departments as well as the closure of several T-Mobile retail locations. Whether the jobs created minus the jobs eliminated would be a net gain or net loss remains to be seen.
The creation of a duopoly most likely would mean less innovation in new devices and less competition, which would likely lead to increased prices for consumers.
Obviously AT&T is lobbying hard for this merger. They stand to lose $6 billion in guaranteed payouts to T-Mobile should it fall through. They have hired a number of lobbyists to try and push support for the merger, today’s letter being the first evidence of their efforts.
In fairness to AT&T, there is nothing unusual or dastardly going on. Whether this letter passes the smell test or not, there are some truths and positives that a AT&T/T-Mobile merger would provide. The real question, and the only question that matters as far as the FCC is concerned, is do the positives outweigh any potential negatives.
Hopefully that is the only thing that the FCC focuses on when this merger comes before a vote.