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AT&T has 'steep climb' ahead to get FCC approval of T-Mobile purchase

post #1 of 44
Thread Starter 
According to an anonymous official at the Federal Communications Commission, AT&T faces a "steep climb" in convincing the chairman to approve its proposed purchase of T-Mobile USA.

The Wall Street Journal spoke with an FCC official, who declined to comment on the record, on Wednesday about the $39 billion deal from AT&T to acquire T-Mobile USA from parent company Deutsche Telekom. "There's no way the chairman's office rubber-stamps this transaction. It will be a steep climb to say the least," said the official.

However, an AT&T spokesperson responded optimistically to concerns that the deal could be held up by the Commission. "We understand that Congress, the DOJ, the FCC, as well as wireless consumers will have questions about the transaction. We look forward to answering and addressing those questions," said spokesman Michael Balmoris. "We are confident that the facts will demonstrate that the deal is in the public interest and that competition will continue to flourish."

According to the Journal's report, comments by FCC Chairman Julius Genachowski on Tuesday indicate the agency's commitment to encouraging a competitive marketplace. "While we're still working through details of a data-roaming framework, I believe the core proposition is beyond dispute: healthy competition produces greater innovation and investment, lower prices, and better service," Genachowski said.

However, Genachowski and other FCC commissioners have remained silent regarding the proposed acquisition, the report noted. In addition to an FCC review, the Justice Department will also evaluate the deal. According to a filing with the SEC, AT&T stands to lose $3 billion if the deal is broken up.

On Monday, U.S. Senator Amy Klobuchar called for the FCC and the Department of Justice to look into the proposed deal. "Although this deal may spark innovation in the wireless industry," Klobuchar wrote in a letter to the two agencies, "I remain concerned that increased concentration will, at the same time, lead to fewer choices, higher prices and reduced service for wireless consumers."

A FAQ posted to the T-Mobile website earlier this week noted that the acquisition could take as long as a year to receive approval, further forestalling the expected arrival of Apple's iPhone on the network.

Third-place U.S. carrier Sprint could stand the most to lose from the proposed deal. Earlier this week, comments from the network's executives at an industry conference suggested that the company's pricing and profitability would be affected if the acquisition were to go through in its current form.
post #2 of 44
C'mon. A couple of mil in kickbacks, a few campaign contributions, and they're all set to marry the bride.

"Apple should pull the plug on the iPhone."

John C. Dvorak, 2007
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"Apple should pull the plug on the iPhone."

John C. Dvorak, 2007
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post #3 of 44
Not so much. Expect divestures. AT&T will give up smaller markets for better coverage in the big ones.
post #4 of 44
Yet another chance for the FCC to try to control things outside of the written law.
post #5 of 44
Quote:
Originally Posted by AppleInsider View Post

...
On Monday, U.S. Senator Amy Klobuchar called for the FCC and the Department of Justice to look into the proposed deal. "Although this deal may spark innovation in the wireless industry," Klobuchar wrote in a letter to the two agencies
...

How exactly does this spark "innovation" in the industry, in the sense that most people understand the word "innovation" to mean? Charging higher prices doesn't count.
post #6 of 44
Quote:
Originally Posted by whatisgoingon View Post

How exactly does this spark "innovation" in the industry, in the sense that most people understand the word "innovation" to mean? Charging higher prices doesn't count.

Exactly. They think that when the masses hear the word "innovation" they'll think, "oooh cool, we're part of something big and innovative" and will shell out extra dollars for something that shouldn't cost shit in the first place. But, for most people, they're right.

Yet another small step towards a non-private, no-options world.
post #7 of 44
Quote:
Originally Posted by JohnLew View Post

Yet another chance for the FCC to try to control things outside of the written law.

Ditto.
post #8 of 44
Leverage ATT to adopt net neutrality and bring wireless to undersea to areas would be great selling point.
post #9 of 44
Quote:
Originally Posted by AppleInsider View Post

said spokesman Michael Balmoris. "We are confident that the facts will demonstrate that the deal is in the public interest and that competition will continue to flourish."

Apparently Mr. Balmoris thinks everyone else's IQ is as low as his.
post #10 of 44
Quote:
Originally Posted by JohnLew View Post

Yet another chance for the FCC to try to control things outside of the written law.

I really don't know why the FCC thinks it's supposed to be involved with this. Seems this is entirely a matter for the DOJ, or at least is supposed to be.
post #11 of 44
Quote:
Originally Posted by AppleInsider View Post

According to the Journal's report, comments by FCC Chairman Julius Genachowski on Tuesday indicate the agency's commitment to encouraging a competitive marketplace. "While we're still working through details of a data-roaming framework, I believe the core proposition is beyond dispute: healthy competition produces greater innovation and investment, lower prices, and better service," Genachowski said.

And he considers the offerings offered by Apple's competitors 'healthy'? Seems one sided to me.
post #12 of 44
Quote:
Originally Posted by Onhka View Post

And he considers the offerings offered by Apple's competitors 'healthy'? Seems one sided to me.

There are plenty of computer, phone, etc. manufactures. The cellular industry has a very high barrier to entry.

The WRITTEN LAW very clearly states the FCC has the RIGHT to block companies for anti-trust reasons.

The chairman is exactly right, more competition is better. Merging reduces competition. ATT in the past became super monopolistic and they have been broken apart many times because of this.
post #13 of 44
Quote:
Originally Posted by ALUOp View Post

Apparently Mr. Balmoris thinks everyone else's IQ is as low as his.

i remember the days when we had a dozen cell carriers in the US. high prices, bad coverage, etc. as the number of companies dwindled due to mergers the prices fell and the coverage area increased
post #14 of 44
I still don't believe this. Germans take (or buy, if they have to), but never sell without an ulterior motive; it's not in their DNA. If the FCC allows it, I predict that AT&T will be German-owned within five years. With their strong Euro it will be very easy for them to increase their stake in AT&T.
post #15 of 44
Quote:
Originally Posted by al_bundy View Post

i remember the days when we had a dozen cell carriers in the US. high prices, bad coverage, etc. as the number of companies dwindled due to mergers the prices fell and the coverage area increased

Most of these phone companies used to be one company. Many of them came into existence after the original AT&T breakup.
post #16 of 44
Quote:
Originally Posted by al_bundy View Post

i remember the days when we had a dozen cell carriers in the US. high prices, bad coverage, etc. as the number of companies dwindled due to mergers the prices fell and the coverage area increased

Do you realize how extreme that is? Sure, find evidence to support your point of view. But cellular prices are crazy high right now. T-Mobile's prices are HALF that of AT&T.

Yes, service improved. Yes phones became cheaper. That correlation, NOT causal. You cannot claim correlation relationships are true.

The reason coverage expanded and prices dropped is because of the natural progression of technology. The second you buy a computer, it is immediately outdated.

It takes time to build networks, that's the only limitation.

JUST LOOK at what competition did to ATT? Verizon said, LOOK you have terrible service. As a result, they have spent billions attempting to improve their service. With monopolies, which is the natural outcome of merging, eventually Verizon or AT&T will be more powerful and buy the other. Then what incentive will there be to lower prices and improve service?
post #17 of 44
But the Verizon takeover of Alltel was a shoe-in?

Really?

   Apple develops an improved programming language.  Google copied Java.  Everything you need to know, right there.

 

  MA497LL/A FB463LL/A MC572LL/A FC060LL/A MD481LL/A MD388LL/A ME344LL/A

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   Apple develops an improved programming language.  Google copied Java.  Everything you need to know, right there.

 

  MA497LL/A FB463LL/A MC572LL/A FC060LL/A MD481LL/A MD388LL/A ME344LL/A

Reply
post #18 of 44
Yeah, who cares which department looks into it as long as it's being looked in to?

Quote:
Originally Posted by Hudson1 View Post

I really don't know why the FCC thinks it's supposed to be involved with this. Seems this is entirely a matter for the DOJ, or at least is supposed to be.
post #19 of 44
Quote:
Originally Posted by DoogH View Post

eventually Verizon or AT&T will be more powerful and buy the other.

This. Cannot. Happen.

If either of them tries, they'll both be split. It's just that simple.

Originally posted by Relic

...those little naked weirdos are going to get me investigated.
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Originally posted by Relic

...those little naked weirdos are going to get me investigated.
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post #20 of 44
You don't seem to understand how things work. The public owns the airwaves, not any company. The government licenses the right to use those airwaves to the private companies. Consequently, the government is supposed to ensure the airwaves are being used to the public's benefit.

The written law gives the FCC the power to draft rules and regulations to control the airwaves to the publics benefit.


Quote:
Originally Posted by JohnLew View Post

Yet another chance for the FCC to try to control things outside of the written law.
post #21 of 44
Quote:
Originally Posted by Suddenly Newton View Post

C'mon. A couple of mil in kickbacks, a few campaign contributions, and they're all set to marry the bride.

That's obviously what they will do. It all depends on whether or not FCC/Congress is satisfied with the total amounts, be it money, hookers, or drugs.
post #22 of 44
Maybe because it is the government agency responsible for regulating the public airwaves and granting licenses for its use. The government gave a license to T-Mobile to use a certain spectrum, and AT&T to use another spectrum. AT&T wants to purchase the license from T-Mobile. The government has to approve that.

Quote:
Originally Posted by Hudson1 View Post

I really don't know why the FCC thinks it's supposed to be involved with this. Seems this is entirely a matter for the DOJ, or at least is supposed to be.
post #23 of 44
Let us hope so. German companies are more consumer friendly.

Quote:
Originally Posted by Roos24 View Post

I still don't believe this. Germans take (or buy, if they have to), but never sell without an ulterior motive; it's not in their DNA. If the FCC allows it, I predict that AT&T will be German-owned within five years. With their strong Euro it will be very easy for them to increase their stake in AT&T.
post #24 of 44
Quote:
Originally Posted by rtm135 View Post

Yeah, who cares which department looks into it as long as it's being looked in to?

You should care. Otherwise, we end up with a government that does things they want to do instead of things the law says they are permitted and obligated to do. I elect my representatives to create laws. I don't elect the bureaucrats and so I'm counting on the bureaucrats to do what the law, voted on by my reps, says they can and should do.
post #25 of 44
Quote:
Originally Posted by TBell View Post

You don't seem to understand how things work. The public owns the airwaves, not any company. The government licenses the right to use those airwaves to the private companies. Consequently, the government is supposed to ensure the airwaves are being used to the public's benefit.

The written law gives the FCC the power to draft rules and regulations to control the airwaves to the publics benefit.

I don't think I'm the one that doesn't understand.

What part of this makes you think the FCC is concerned with the spectrum?

Also, what part of existing anti-trust laws would prevent this deal from going through?
post #26 of 44
Quote:
Originally Posted by DoogH View Post

Do you realize how extreme that is? Sure, find evidence to support your point of view. But cellular prices are crazy high right now. T-Mobile's prices are HALF that of AT&T.

Yes, service improved. Yes phones became cheaper. That correlation, NOT causal. You cannot claim correlation relationships are true.

The reason coverage expanded and prices dropped is because of the natural progression of technology. The second you buy a computer, it is immediately outdated.

[COLOR="red"]It takes time to build networks, that's the only limitation.[/red]

JUST LOOK at what competition did to ATT? Verizon said, LOOK you have terrible service. As a result, they have spent billions attempting to improve their service. With monopolies, which is the natural outcome of merging, eventually Verizon or AT&T will be more powerful and buy the other. Then what incentive will there be to lower prices and improve service?

But without large, nation wide cellular company, there was no incentive to build nation wide network and improve coverage. And smaller companies can only expand quickly to become large companies by mergers. So you can't say all mergers are bad for consumers and innovation.

One way I see this merger benefit consumer is cell phone makers have one less carrier to worry about, so they maybe able to divert some of the money spent to custometically change a phone for the carrier to actually improve the phone itself.
post #27 of 44
Sprint is starting to sweat, and rightfully so.
post #28 of 44
You don't understand what the FCC does.

The FCC oversees Broadband, Competition, Spectrum, Media, Public Safety and Security, and Modernization.

AT&T absorbing the fourth largest mobile carrier in the country and growing into one of the largest mobile carriers in the world. From the standpoint of competition, you do not see that as something to look into?


Quote:
Originally Posted by JohnLew View Post

I don't think I'm the one that doesn't understand.

What part of this makes you think the FCC is concerned with the spectrum?

Also, what part of existing anti-trust laws would prevent this deal from going through?
post #29 of 44
Quote:
Originally Posted by DoogH View Post

Do you realize how extreme that is? Sure, find evidence to support your point of view. But cellular prices are crazy high right now. T-Mobile's prices are HALF that of AT&T.

It certainly depends on how you look at it. When I first got a mobile phone 13 years ago. The cheapest price plan I could find was with Sprint. I was paying $60 for 50 daytime minutes and 500 night/weekend minutes. It was about one dollar a minute for overages. No texting, no internet nothing else extra.

Do you think anyone would pay for that type of plan today?

Quote:
JUST LOOK at what competition did to ATT? Verizon said, LOOK you have terrible service. As a result, they have spent billions attempting to improve their service. With monopolies, which is the natural outcome of merging, eventually Verizon or AT&T will be more powerful and buy the other. Then what incentive will there be to lower prices and improve service?

AT&T and Verizon are offering terrible service in comparison to what?

If you compare it to 10 years ago the service is obviously vastly better today. 10 years ago it was normal to either have large areas with no service or to pay high roaming fees in areas where you carrier had no service.

Today there are much smaller pockets of areas with poor service and roaming fees no longer exist.
post #30 of 44
Quote:
Originally Posted by TenoBell View Post

You don't understand what the FCC does.

The FCC oversees Broadband, Competition, Spectrum, Media, Public Safety and Security, and Modernization.

AT&T absorbing the fourth largest mobile carrier in the country and growing into one of the largest mobile carriers in the world. From the standpoint of competition, you do not see that as something to look into?

So now it's not about the use of the spectrum and the FCC's domain over the licensing of that spectrum, it's about protecting competition - which again leads to my second question, what part of the current anti-trust laws would prevent this deal from going through?
post #31 of 44
Essentially AT&T would have to prove that it will not abuse its position. That it will not engage in anti-competitive practices against other companies. That it will not limit consumer options and raise prices.

The FCC will look through all of the nations markets to see where AT&T and T-Mobile are the two dominant carriers. In markets like that AT&T will have to sell its T-Mobile's properties to a competitor.

If the FCC feels the very nature of this merger will push anti-competitive behavior and limit consumer options they do not have to approve the merger.

Quote:
Originally Posted by JohnLew View Post

So now it's not about the use of the spectrum and the FCC's domain over the licensing of that spectrum, it's about protecting competition - which again leads to my second question, what part of the current anti-trust laws would prevent this deal from going through?
post #32 of 44
It would be far better for consumers if the FCC denied AT&T, and mandated a merger between T-Mobile and Sprint, and then Apple created an iPhone version for that group as well.

Unless you make Android phones that is!
post #33 of 44
It's obvious we're heading to a Verizon/AT&T mobile country. As long as their are two companies then you have competition.

What people have to realize or remember is AT&T is not the AT&T of yesteryear. Cingular bought AT& and decided to keep the name. AT&T did NOT have rollover, sheesh!

As long as their is a Verizon / AT&T fight then we'll have healthy and continuing price wars; ala competition. I also don't think Sprint will be gobbled up as their books are pretty strong and they have a decent network that is huge, albeit not as big as the big two.
post #34 of 44
Quote:
Originally Posted by pcworth@charter.net View Post

It would be far better for consumers if the FCC denied AT&T, and mandated a merger between T-Mobile and Sprint, and then Apple created an iPhone version for that group as well.

Unless you make Android phones that is!

Maybe if you live in China and like a centrally planned economy.

The problem with fears of "limited competition" is that today's AT&T and T-Mobile are hobbled competitors. AT&T doesn't have Verizon's reach but has a newer more globally standard network with much greater potential for speed improvements.

T-Mobile has the bandwidth and network capacity to grow, but it's non-standard and higher frequency, meaning it will never get good phones, and that its mobile service is limited from working well for rural users (or penetrating buildings). TMobile is cheaper, not because the company is more generous but because its service is less valuable! That's how the market works dummies.

Together, US consumer gets a much improved competitor to Verizon (in coverage), a much faster 3G+, and a much earlier rollout of LTE, which will help not just AT&T but also Verizon, which will roam its users between the two.

This is a consolidation (which I'm not usually quick to support), but it's different than most consolidations because it's not just two widget makers or content producers joining forces to create layoffs and reduce the number of competitors.

In this case, you have two service providers handling limited public spectrum, which together they can use far more effectively than were they to remain separate. I'd rather have one national train network than two competing systems that didn't have tracks to every city, but had duplicate tracks to many cities providing negligible "competition."

TMobile was headed out of business in any event. Joining with Sprint would be a nonsensical boondoggle that only a Chairman Mao could recommend in "sounds like a good idea" ignorance.

The people who liked TMobile's cheap/low quality service can move to Cricket or Metro PCS. The US can finally get a real, nationwide, fast network, and 5-10 years faster than otherwise. AT&T will get immediate improvements, making it more competitive with Verizon and forcing both to offer better plans, as they already have.
post #35 of 44
Quote:
Originally Posted by Suddenly Newton View Post

C'mon. A couple of mil in kickbacks, a few campaign contributions, and they're all set to marry the bride.

Not until the FCC makes a big show of how they agonized over the approval.
post #36 of 44
Quote:
Originally Posted by Pennywse View Post

As long as their is a Verizon / AT&T fight then we'll have healthy and continuing price wars; ala competition.

If you have only two big competitors, doesn't that make price fixing that much easier and tempting?
post #37 of 44
There is a long historical basis and strong economic theory basis for rejecting this proposed acquisition, and rejecting it quickly.
post #38 of 44
Boost mobile. virgin mobile net 10. leap wireless Metro pcs straight talk. Cellular one. Sure there are many more cheap choices i forgot to mention i dont want it to happen either but just showing there are plenty of cheap alternatives to pick from if we end up having too but if it does i may do boost mobile 50 unlimited everything blackberry plan
post #39 of 44
Hmm. Mild conspiracy theory: anyone else starting to think that AT&T’s DSL/U-Verse data caps were implemented as a negotiating/bargaining chip for FCC approval of this T-Mobile buyout? Think about it: AT&T just created out of thin air something it can “give up” as a way of appearing reasonable and considerate of federal regulators. The politicians can look like they’ve done something positive, despite merely restoring the status quo.

In a way, this is sort of like the NFL’s push for an 18 game season in CBA negotiations. They appear to not have been truly serious about the prospect, but simply created the issue as a bargaining chip. “We’ll give this up (not that we ever really wanted it) if you’ll give up something as well.”

Here’s hoping that’s the case. I genuinely don’t mind AT&T acquiring T-Mobile if Sprint can somehow get its act together. Of course, Verizon might simply buy out Sprint, and suddenly we might be left hoping Comcast (shudder) gets into the mobile phone game just to provide competition.
post #40 of 44
Boost mobile. virgin mobile net 10. leap wireless Metro pcs straight talk. Cellular one. Sure there are many more cheap choices i forgot to mention i dont want it to happen either but just showing there are plenty of cheap alternatives to pick from if we end up having too but if it does i may do boost mobile 50 unlimited everything blackberry plan


What about those guys above why not support them help one of them become thennext tmobile sized compNy and support small businesses
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