The FCC is providing key details about why it decided against approving AT&T’s merger with T-Mobile USA in a 109-page report slated for release today.
The redacted document refers to “substantial material questions of fact” about many of AT&T’s claims about the deal’s benefits on jobs, competition and broadband deployment – benefits the commission ultimately found insufficient to approve the deal.
The Justice Department may use the report as added ammunition in its antitrust case against the deal.
The results of the agency’s review calls into question AT&T’s plan to expand its LTE network to 97 percent of the U.S. population only if the T-Mobile deal was approved, versus just covering 80 percent of the population if the transaction fell through.
The FCC judged it likely that AT&T would go with the larger deployment even without the merger to keep pace with competitor Verizon Wireless, which plans to deploy LTE to its entire 3G footprint.
The agency’s findings also refuted AT&T’s claim that its acquisition of T-Mobile would result in both efficiencies for its business and more jobs. The FCC’s analysis actually found that the merger would result in a significant net loss of jobs.
AT&T legislative affairs executive Jim Cicconi called the release of the report “improper” and “troubling.”
“The FCC has recognized that it is required by its own rules to dismiss our merger application. This makes all the more troubling their decision to nonetheless release a preliminary staff report on the merger,” Cicconi said in a statement. “The draft report has also not been made available to AT&T prior to today, so we have had no opportunity to address or rebut its claims, which makes its release all the more improper.”
The report had been slated to be released in conjunction with a draft order to send the transaction to a hearing, but AT&T pulled its application for the deal before the FCC held a vote on the proposal.
Groups opposed to the merger had asked the FCC to block the withdrawal of the application, arguing it allowed AT&T to exploit a procedural loophole to avoid additional scrutiny over the deal.
Agency officials said today that AT&T would be allowed to withdraw its application, but decided to release the report in the interest of transparency. The report had been prepared for release before AT&T pulled its application.