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Public Knowledge roasts congress over letter supporting AT&T / T-Mobile merger

Written by James Delahunty @ 25 Jun 2011 1:52 User comments (2)

Public Knowledge roasts congress over letter supporting AT&T / T-Mobile merger House democrats sent letter to FCC Chairman Julius Genachowski and Attorney General Eric Holder, seemingly supportive of AT&T's proposed buyout of T-Mobile.
In the letter, the members of congress urge the pair to consider the benefits of increased coverage. They state that as part of the merger, AT&T has committed to building a next generation wireless broadband network that proposed to cover 97 percent of Americans, and that such a commitment will cost billions of dollars and create thousands of jobs.

Public Knowledge has made no secret of its opposition to the merger, and has responded to the letter from congress. Firstly, Gigi B. Sohn, president and co-founder of Public Knowledge, notes that the letter does not specifically endorse the takeover of T-Mobile by AT&T, pointing out that it states all relevant issues including consumer prices, competition and innovation should be studied thoroughly.

However, there are claims made in the letter that Public Knowledge objects to. On the jobs creation claim, Sohn says that AT&T's next generation network proposals are only marginally better now than they were before anyway, and that a merger of AT&T and T-Mobile would cost jobs, not create them.



"They might have asked AT&T and the CWA why the company was spending $39 billion to buy T-Mobile instead of expanding their coverage, as they could have done at any time rather than use the buyout as a threat or, as former FCC Chairman Reed Hundt characterized it, a ‘state-authorized bribe’," writes Sohn.

"It is unfortunate that proponents of the merger have been able to mislead so many Members of Congress. Nothing is to be gained from this deal except that a major competitor to AT&T will be removed from the market, resulting in higher consumer prices and less innovation. We are disappointed that the members of Congress who signed the letter did not view this aspect of the deal more closely."

Tags: T-Mobile AT&T
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2 user comments

127.6.2011 11:06

lol @ capitalism

228.6.2011 13:21

The Economic Policy Institute produced a study, not too long ago, showing that 12,000 jobs are created for every $1 billion invested. Of those 3,500 are directly employed by the wireless company and the remainder are split between suppliers who sell materials and services to the telecom companies and “induced” employment as all these new workers increase demand for goods and services. AT&T has pledged to invest $8 billion to buildout the combined AT&T and T-Mobile network. By EPI math, that’s 96,000 jobs. I say let’s do it! But get the FCC and DOJ to nail down that commitment, and huge penalties if AT&T misses the mark.

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