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Posted at 10:00 AM ET, 12/01/2011

AT&T fires back at FCC, digs heels deeper into fight for T-Mobile


(RICK WILKING - REUTERS)
This post has been updated since it was originally posted.

AT&T on Thursday fired back at the Federal Communications Commission with a scathing rebuttal of a merger report that the company described as "one-sided" and favoring competitors.

AT&T, digging in its heels more deeply in its bid for T-Mobile, said that the FCC staff report issued this week “cherry-picks” facts to support only a negative view of the $39 billion deal. And the company pointed to inconsistencies in the report’s findings on the agency’s own claims in other issues.

"The document is so obviously one-sided that any fair-minded person reading it is left with the clear impression that it is an advocacy piece, and not a considered analysis," said AT&T Executive Vice President James Cicconi in a blog post.

The FCC strongly disagreed with AT&T’s characterization of its merger analysis. The agency said Thursday that staff “dispassionately analyzed all the facts” presented in hundreds of thousands of pages of documents.

“The AT&T/T-Mobile merger would result in the single greatest increase in wireless industry consolidation ever proposed,” a FCC spokesman said Thursday. “In addition, AT&T's own filings, many of which they have kept confidential, show that the deal would lead to massive job losses."

The statement escalates an already fierce battle between AT&T and T-Mobile and federal government regulators, who are fighting the deal. Cicconi said on Thursday after speaking on a panel at the Pheonix Center that the firm has “no choice” but to respond to the FCC’s report.

Analysts say the chances of the deal being approved are slim. When asked whether his strongly worded blog post would make it even harder for the company to reapply for their merger at the FCC, Cicconi said to reporters after a Phoenix Center panel Thursday that he felt he had “no choice.”

“Their report was strongly worded, too,” Cicconi said.

The companies have argued that their deal will benefit consumers, as the acquisition would allow AT&T to expand its high-speed mobile network to more Americans. But the FCC and DOJ have slammed the merger as an anti-competitive deal that would lead to higher prices on monthly wireless bills.

Cicconi argued with those findings, however, saying in his blog that the FCC staff report “cherry-picks” facts that made the deal look bad. He said the report appeared to relay nearly all the arguments presented by competitors such as Sprint Nextel, who have fought to block the deal.

And the agency’s own analysis at times was inconsistent with the FCC’s arguments on separate issues, Cicconi said. The FCC, for example, said the combination of the nation's second- and fourth-largest wireless companies would lead to job losses and higher prices for cellphone users.

AT&T has argued that its expansion of high-speed mobile Internet networks with T-Mobile airwaves would create many more jobs. And the company notes that two weeks ago, the FCC touted its own plan to put $4.5 billion of federal funds into broadband networks and create tens of thousands of jobs.

"This notion — that government spending on broadband deployment creates jobs and economic growth, but private investment does not — makes no sense," Cicconi said.

The FCC said in its report released Tuesday that the company has historically cut more jobs than it has added after acquisitions. The agency also said AT&T has admitted that some jobs would be lost through attrition and reductions where positions overlap.

Consumer advocacy groups Free Press and Public Knowledge both issued statements defending the FCC against AT&T’s accusations. Both groups have been vocal opponents of the merger.

“For AT&T to say that it did not receive a fair hearing before the Federal Communications Commission is ludicrous,” said Public Knowledge’s legal director Harold Feld. “The Commission staff went out of its way to give AT&T every opportunity to make its case before concluding that the company had not done so.”

By  |  10:00 AM ET, 12/01/2011

 
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