23 Comments

Summary:

AT&T has proven many times in the last few months that it just can’t let its failed acquisition of T-Mobile go, but on Friday its bitterness turned to vindictiveness, delivering a big “I told you so” to its critics after T-Mobile announced 1,900 layoffs.

at&t-mobile-merger

AT&T has proven many times in the last few months that it just can’t let its failed acquisition of T-Mobile go, but on Friday the bitterness turned to vindictiveness. This statement from Jim Cicconi, AT&T Senior EVP of External and Legislative Affairs, was posted on AT&T’s policy blog in the morning:

Yesterday, T-Mobile made the sad announcement that it would be closing seven call centers, laying off thousands of workers, and that more layoff announcements may follow. Normally, we’d not comment on something like this. But I feel this is an exception for one big reason– only a few months ago AT&T promised to preserve these very same call centers and jobs if our merger was approved. We also predicted that if the merger failed, T-Mobile would be forced into major layoffs.

“At that time, the current FCC not only rejected our pledges and predictions, they also questioned our credibility. The FCC argued that the merger would cost jobs, not preserve them, and that rejecting it would save jobs. In short, the FCC said they were right, we were wrong, and did so in an aggressive and adamant way.

“Rarely are a regulatory agency’s predictive judgments proven so wrong so fast. But for the government’s decision, centers now being closed would be staying open, workers now facing layoffs would have job guarantees, and communities facing turmoil would have security. Only a few months later, the truth of who was right is sadly obvious.

“So what’s the lesson here? For one thing, it’s a reminder of why “regulatory humility” should be more than a slogan. The FCC may consider itself an expert agency on telecom, but it is not omniscient. And when it ventures far afield from technical issues, and into judgments about employment or predictions about business decisions, it has often been wildly wrong. The other lesson is even more important, and should be sobering. It is a reminder that in government, as in life, decisions have consequences. One must approach them not as an exercise of power but instead of responsibility, because, as I learned in my years of public service, the price of a bad decision is too often paid by someone else.”

So what is AT&T trying to prove here? That T-Mobile is a struggling company? Of course it is. It wouldn’t have tried to sell out to Ma Bell if its profits were surging and its customer base were booming. But is AT&T actually implying it would kept all 24 of T-Mobile’s call centers open in the face of enormous redundancies?

For AT&T to continue to maintain the fiction that it would somehow of created more jobs if it acquired T-Mobile is ridiculous now that the merger is dead. The Federal Communications Commission; the U.S. Department of Justice; and numerous industry, public policy and consumer groups have all refuted those claims, accusing AT&T of simply making up numbers in a lousy economy to further its consolidation ambitions.

AT&T, it’s time to move on.

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  1. I have to disagree with your commentary. I was not a fan of the proposed merger, but I must say, I’m not sure which quote you were reading. Should ATT move on? Absolutely. However this comment is more an indictment of the FCC than T-mobile. The sports equivalent is a team blaming the officials after a loss, they’re not saying, we lost because the other team sucks. Whether it should be pointed out at all is another concern, but the message to me hear is clear, ATT is displeased with the FCC (every corporation hates regulatroy agencies). I think you are reading into this too far.

    1. Hi mminasian,

      I believe, I read it the same way as you. AT&T is using the T-Mobile as cudgel to whack at the FCC. Using the misfortune of others to further your own policy agenda is pretty tactless though.

  2. Kevin Herrera Friday, March 23, 2012

    I think the folly here is that government intervention happened at all. The government is supposed to stay out of private affairs unless the public (not the public interest) is harmed. If one company wants to buy out another, it is not the business of our government. I also believe it to be ridiculous when the government can say “we’ll protect your jobs”, despite the consumers of the market shopping elsewhere. Where are they going to get the money? The Federal Reserve?

    For those that are about to argue that job loss is harm, you’re also harming the gainfully employed of that business by forcing the employer to keep unproductive employees. This is how you put a company out of business.

    1. Kevin Herrera, the “folly here” is your abject failure to recognize that the “private” companies in question are wireless carriers that operate using licensed spectrum, which is a public resource. If “private” companies do not want to be subject to government regulation, then they can stop using a public resource and get out of the business of providing a de facto public utility. Bar none.

      AJ

      1. If the FCC requires that a business allow it to tamper with business operations, then the problem is with licensing requirements and the management of those licensed shares.

        I’m all for properly managing shares of some public, and unownable, resource, but I don’t think it’s right or even constitutionally legal if the business has to dance with the devil in order to do acquire a share.

      2. Situations involving limited public resources and precious little competition is something this country has been through before, many times, including run-in’s with AT&T, and it’s where hardline laissez-faire ideologies shit the bed.

  3. Thank goodness this article was on google news, because due to this lousy biased article and horrible opinionated verbal vomit, you will soon loose your ad revenue. Perhaps it is you that is hanging on too strong. Get over charged or drop a call to make you so sensitive?

  4. Robb Chadwick Friday, March 23, 2012

    While I feel that AT&T probably should have said nothing about the T-Mobile layoffs at this time, I don’t think their statement is aimed at T-Mobile or it’s employees at all. Their criticism is of the FCC. We will never know for sure what would have happened had the merger been successful. However, I don’t think they would have written the statement if they didn’t sincerely feel they could have made important contributions to T-Mobile & it’s employees.

    1. Hey Robb,

      No, I agree the statement was targeted at the FCC and the merger’s other critics, but AT&T is using the misfortune of T-Mobile and its employees to further its policy agenda. That’s in pretty bad taste even if you believe AT&T claims the merger would have created jobs.

      1. How would you rather they approach this, Kevin? Completely ignore reality? Perhaps use the phrase “a mobile carrier that shall remain nameless” in lieu of “T-Mobile”? I find your bleeding heart in bad taste.

    2. Give me a break. AT&T feels “sincerely” about pleasing its shareholders. All else — providing employment, stewarding public wireless spectrum, serving the public interest — are just necessary evils to AT&T. If that is how AT&T is going to treat society and if AT&T has become too engorged for the “free market” to check AT&T’s anti consumer arrogance, then damn well expect the public to wield its power and exact corrective measures through government regulation.

      AJ

    3. Actually, we do know what would have happened if the merger went through. To please the regulators, AT&T guaranteed that those exact same people being laid off now would not be laid off.

      1. Nobody has yet to answer the question of when was the last merger that didn’t result in some layoffs? I don’t know what AT&T was smoking to say they wouldn’t lay anyone off.

  5. I also disagree with your commentary, and I’m not fan of AT&T.

    Perhaps the author had no clue about the whole FCC thing when he wrote this. Wouldn’t surprise me.

    AT&T has the right to say just this very thing. Good for them, too bad for Tmob…

  6. Where was AT&T’s press release two weeks ago when Verizon Wireless announced they are closing 3 help centers, and laying off 3000 employees…

  7. I worked for the Death Star and it’s the height of hypocrisy for them the claim those centers would still be open. In fact one of the first things SBC, the real leadership behind AT&T 2.0, did when they acquired PacBell and BellSouth was make sweeping cuts to eliminate “redundancies”. For them say this wouldn’t have happened if T-Mobile had been absorbed is utter BS.

  8. do you guys even realise how important tmobile is for carrier competition??? apparently not!!

  9. It is a very predictable event. The government bureaucrats that can’t make it in the business world thinking that they know more than the leaders running a major corporation. Would you anticipate any other outcome? Just wait until ObomaCare kick in fully. What a disaster!

  10. Canada Newspaper Saturday, March 24, 2012

    A business allow it to tamper with business operations, then the problem is with licensing requirements and the management of those licensed shares.

  11. One more reason why I’ll never signup with ATT. For now, I’m sticking with T-mobile; if the merger had gone through, bye-bye ATTMobility…hello, Credo. Still may switch.

  12. Government intervention was needed to prevent monopolies from forming.

  13. TMO was (is) dead..the merger could have at least saved ost of it..the liberals that did them in should sleep well tonite, still thinking they battled against capitalism and won..tell that to TMO when they are in bankruptcy

  14. Wow – I see the Teabagging faux “libertarians” who suck up to Corrupt Fatcat Big Telco are REALLY out in force today.

    AT&T needs to handcuffed, hard, with regulations and FORCED to give its customers what they pay for!

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