AT&T has quite a bit of schmoozing in its future, as FCC officials claim that the wireless giant’s chances at getting approval for its $ 39 billion acquisition of T-Mobile are slim to none. While a formal evaluation from the FCC has yet to commence, we’ve already seen a pretty heated response to the deal from Democratic senators, urging the FCC to look closely at the repercussions of this merger. If the AT&T/T-Mobile deal does come to fruition, America’s second-place carrier would become number one and represent 42 percent of wireless subscribers nationally, after swallowing up fourth-place carrier T-Mobile.
“There’s no way the chairman’s office rubber-stamps this transaction. It will be a steep climb to say the least,” said an FCC official, who chose to speak off-the-record. However, the FCC’s assurance that no monopoly shall become of this should definitely be taken with a grain of salt, as this wouldn’t be the first time that the FCC approved a deal despite warnings from officials concerned about competition. In 2008, just a year after FCC Chairman Kevin Martin claimed that “the hurdle [...] will be high” to approve the Sirius Satellite Radio/XM Satellite Radio merger, the deal went through. AT&T stills holds strong to its position that this deal is in the public interest and will not inhibit competition in the industry.
However, the FCC is expected to make some regulation adjustments that favor smaller carriers by approving proposed rules that would place a much more reasonable price tag on data roaming. Currently, the FCC doesn’t require carriers to offer data roaming to rivals the same way it does with voice calls, despite the fact that a significant uptake in smartphones has led to a speedier growth rate for data traffic than for voice call traffic. Current FCC Chairman Julius Genachowski recently claimed that the upcoming adjustment to data traffic regulation is a clear indication of the agency’s desire to foster a competitive wireless 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,” Mr. Genachowski said. As of yet, we’ve heard nothing official from the FCC concerning the AT&T/T-Mobile deal, but as it looks so far, anything could happen.
- [via WSJ]
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