FCC chairman Julius Genachowski, has asked for an administrative law judge review of the proposed takeover of T-Mobile USA by AT&T. The request, which is widely seen as a major blow to the deal by commentators, was made in a draft order to other FCC…
FCC chairman Julius Genachowski, has asked for an administrative law judge review of the proposed takeover of T-Mobile USA by AT&T. The request, which is widely seen as a major blow to the deal by commentators, was made in a draft order to other FCC commissioners.
A senior FCC official said in a statement sent to TelecomFinance: “The record clearly shows that – in no uncertain terms – this merger would result in a massive loss of US jobs and investment.”
The references to jobs and investment directly contradict some of AT&T’s core arguments in favour of the deal.
On AT&T’s website promoting the deal, the company lists increased infrastructure investment, increased investment in rural communities and job creation amongst the top 10 benefits of combining AT&T and T-Mobile.
AT&T’s senior vice president of corporate communications, Larry Solomon, described the FCC’s action as “disappointing”.
He said: “It is yet another example of a government agency acting to prevent billions in new investment and the creation of many thousands of new jobs at a time when the US economy desperately needs both.”
He added that, at this time, AT&T was reviewing all options.
Meanwhile, Sprint Nextel, one of the companies that has launched a lawsuit against the AT&T/T-Mobile deal, welcomed the news.
Sprint’s SVP of government affairs, Vonya McCann, noted that Genachowski had said in August, when the US Department of Justice filed its own separate lawsuit against the deal, that the record before the FCC presented “serious concerns about the impact of the proposed transaction on competition”.
McCann said: “That record is complete and more than justifies moving this matter to an Administrative Law Judge for a hearing. We appreciate Chairman Genachowski’s leadership on this issue and look forward to the FCC moving quickly to adopt a strong hearing designation order.”
